The X-Interviews | Performance & Design

Interview #1 - Peter Bull on Performance Management and Design as a Hub

Peter Bull on Performance Management and Design-as-a-Hub.

When Bill Gates created the Microsoft Business Intelligence Group in the early 2000s, an elite team of subject matter experts was assembled. Peter Bull was the top Corporate Performance Management SME of the team. Peter and I first met shortly after I had been hired as a Researcher. In that role I was tasked with informing Design decisions for a highly complex financial modeling, analytics, and scorecard platform aimed at managing the performance of Finance, Operations, Sales, and HR for global enterprises. From the first encounter, I found Peter Bull to be one of those rare individuals who can create connections between Business Objectives and Design Strategy. And as you will see, Peter still creates purposeful connections between Business and Design.

X-Mentor: Peter, welcome to The X-Mentor for our very first interview on the topic of Design Value and Business Impact. Just by way of introduction, Peter Bull has spent some time early in his career with SAS, leading business applications and software operations. Peter, I as mentioned above, we met at Microsoft when you were a senior leader on Business Intelligence and Performance Management. And of course, since that time you've gone on to pioneer early mobile software applications that focus on business intelligence as well. And currently, you are the CTO of River Logic, which is an advanced analytic software company. Is there anything you would like to add to that, Peter?

Peter: That just makes me feel a bit old. That's all, Greg. In all seriousness, I've been very fortunate, you know, to be able to  work in data and analytics and decision making, helping organizations to improve throughout my career. I never started out with that goal, but it's something that, you know, I've really vested in. So, I consider myself lucky there, and very much looking forward to this conversation.

X-Mentor: Super! Well, I really appreciate you being on The X-Mentor today.

Decision Making

X-Mentor: What has your experience been in trying to help people make more informed decisions – including the role that data and modeling has played?

Peter: Yeah, certainly is a great question, Greg. And I think when you're dealing with organizations, particularly Senior levels of senior decision makers, people often get sort of intimidated, maybe, about how they surface up data in context for decision making. The flip side of that is senior leaders typically have gained experience, have latched on to either formal or informal metrics that help them guide their decision making. And you'll get situations where people will talk about their gut reaction or things like that. It's seldom that people are making decisions in complete lack of context. They've got some indicators that they use, and I think that's an important clue as we move forward, that lining up across an organization what those indicators are, you can call them metrics, with data bound areas are really the key focus you'll get. You'll get situations where people say, well, we can't provide that to senior leadership because it's too detailed. or they'll get confused, which incidentally I always find amusing that it's easy to confuse senior leaders. It shouldn't be. But reality, is those leadership people are looking for key metrics that they identify with. And most importantly, and here's the clue to why they've arrived where they are, because they know they can rely on them, and they have varying levels of trust in them. They've proven in the past to help them shape those decisions. So that's the clue in all of this, is lining up the right metrics in with the right relationships. Which may sound familiar in previous contexts, and they go by different names over the years, which is fine.

X-Mentor: What do you have to say about the C-suite, who say CX & UX matters, but too few can prove the value of design?

Peter: So, starting up with the design focus. Like any area, design is a significant investment. And rightly so. For so many companies across the board.

And why would you do something without expecting some sort of return on that? But here is where the rubber hits road. How do you measure that return?

There's the challenge in all of this.

The fact that there is a disconnect, typically between lead and lag indicators, and particularly the lag indicators, which is where I've talked about the senior management placing their trust. So, things like revenue, profitability. I'm going to say boring financial indicators, the fundamentals there.

Whereas if you think about what design is fundamentally doing. They really should be one of the preeminent lead indicators. Because you’re designing for how customers are going to fundamentally interact with your product, your services, your brand. It should give a very clear relationship into the ongoing operational aspects of the company and ultimately in the financials. And it seems the gap can appear too big.

“If you jump straight to the financials, you lose the plot.”

However, in reality that gap is not too big, but it's where the typical reaction comes in that we can't tell that by having a team of designers working customer experience whether that increases revenue or not. What's the impact of it? What does it go to? And like any area, I'm going to call it performance management, where you're looking for a return on investment, you need to plot that out up front as well.

So, alongside your design, there is the intent of the design. What is it you're expecting to bring to that customer journey, to the overall operational?  

Is the intent that you want to reduce friction on customer acquisition and the cost of customer acquisition? Maybe balance that with some levels of churn, and pull that back to positive signal? Be able to grow your customer base, usage, utilization, all those things, and then overlay that with the sentiment of your customers?

And the benefits we have today compared to some time ago is that it's relatively easy now to collect very thorough customer-centric data, depending on how you’re delivering your product or service. But it's a poor excuse to say that we don't have the data. It's more important now what you do with the data, and how you treat that as well. But, to the key point upfront. You need a plan for how your design team and design operations are going to contribute. Every other area has a plan, so it should be the same.

Performance Management

X-Mentor: How do businesspeople today think about performance management?

Peter: It’s a very interesting journey. When we were at Microsoft, the whole notion of score cards and models that support those scorecards was a very hot topic.

That term, “performance management,” from just seeing how it's used today has diminished somewhat, and it's being replaced with really the term “Dashboard.

Which, from my point of view, I really don't mind what things are called as long as you're doing the right things. Whatever is the easiest to convey and communicate.

X-Mentor: Why has that changed?

Peter: Well, the ability to assemble reports, metrics, analysis and convey those, a lot of those barriers that existed when we were in Microsoft, starting that journey, because that was the opportunity, have been overcome. So, it’s relatively straightforward now for corporate and organizations to roll out the data, reports, etc., that help operational, strategic, and performance across the board. During that journey, though, some of the techniques, I think that were very helpful, have kind of diminished, although they are there in a way.

But if you remember when we were doing it, Greg, we wanted the most simplistic, but one of the most effective, ways to convey what is happening with the good old traffic light system: red, yellow, green at a glance. I can remember doing a lot of presentations in Microsoft to senior leaders there, and the whole approach was to convey on each key topic. “Were we Red, Yellow, or Green?” And then take appropriate steps from there.

That is, I think, something that is diminished, and because dashboarding and reporting has been liberalized in organizations, it hasn't been enough preempted to planning design and consideration given to how that data needed to be communicated effectively.

So, we're back actually at a juncture where our internal audiences, let's call them our internal customers, also are challenged with a lack of adequate design and thoroughness in the dashboards that they interact with as a generalization. Not true in all cases, but it's one. And you'll know the symptoms if you're in that situation, you'll have a plethora of reports in your dashboards that don't provide immediate clarification – but provide confusion. And you've got varying versions of them as well.

So, in the old days, when you had Excel files lying around, now you've got dashboard reports just multiplying to an extent out of control. Because the answer to the question that is posed will create another report for that, and another report, and another report, and so on, without any design overlay necessarily going in there. Which really means the design overlay is your model.

Customer-centricity: Protective vs. Innovative

X-Mentor: What is customer-centricity? And what does it mean to actually be customer centric as a senior leader of an organization?

Peter: It's a fascinating question. And I’ll give you a context. Before joining Microsoft, I did a white paper on The Shift from Product Centric to Customer Centric Design Approach for Software Companies. I was probably somewhat optimistic in that viewpoint, that of which would be embraced. And further, really give a boost to organizations and software design that I was expecting.

X-Mentor: Why is that not the case?

Peter: You know, the people talk to it. But do they live it? And I think that's the start of anything. You've been there with any important Initiative driver that you want. It has to start with your leadership.  And it has to start with, fundamentally, not even your strategy. It's your culture. But it's most important to embrace customer centric.

It requires, fundamentally, a trust in your customer. By servicing them, by creating value with them, that you will also create value for your organization.

As opposed to the product-centric, where we came from, which would develop a product and try and find the market fit for those customers. And be protective of your market, rather than innovative in your market. And you and I have talked quite a bit around the subject of innovation. But innovation is one of the biggest signals that you are customer centric. Because you are trying to innovate how customers are interacting, what they can do that overcome issues, challenges, or create new things for them in ways that they didn't necessarily imagine what thing could be done. So, innovation is tied very closely to customer centric as opposed to product centric, which is protective market mentality. e.g., “Keep the competitors out.” “Don't let customers have too much choice.” You know all those… And it's still there to some degree today. And I don't mind saying, it was one of our challenges when we were at Microsoft. We saw vestiges of that product-centric, protective market sort of aspect. We saw that clearly in the mobile space with the emergence of the iPhone, iPad mobility and they're [Microsoft] actually saying: “There is no way we’re going to allow any Microsoft software to run on those devices.” That is a great example of not being customer centric.

Measuring with Rigor

X-Mentor: Do we measure business with rigor? And what would rigor look like when measuring design?

Peter: Yeah, the rigor certainly emerged in a very positive way. I would say, you can walk into most organizations, and you ask them how they track and manage their operations, their performance, they'll be able to reel off across the different functional areas. What is measured, what is managed. And the data to support that – that’s pretty clear. Doesn't have to be necessarily in the ways that is optimized, say. But it's there to varying degrees. You can say that, certainly, the ability to collect data across operations, there's been a fuel and enabler for that. The cloud is a key part of that and the data flows that happen. And certain areas of organizations are more centric on some of their measurements and management nowadays.

So, let's take the example of Digital marketing. There's a very good example where the clear success metrics or metrics to measure success are pretty well established. So, it's easier to adopt when there is industry recognized metrics that you can incorporate in your own organization. That is a key enabler, let's call it performance management or business performance management. So, the management of marketing into sales pipelines, etc., etc., supported by lots of different software options out there now, ready-to-go metrics around them, ready-to-go reports and analysis around that as well.

Why? Because there's a clear relationship, isn’t there, between getting your marketing right and driving your revenue out of that – very easy.

But in terms of Design, that opportunity is still sitting there.

Modeling ROI of Design

Peter: So, we talked about the question of modeling. But it's one for which modeling can sound very intimidating. A designer might say, “Oh, yeah. Wow! We’re gonna sit down and define a model of how our design practice is gonna generate the return for the business and organization? Where do we even start?”

That, I think, is one of the tremendous barriers sitting there. It's that intimidation and not knowing how or where to start.

The reality is, the model can be very, very simple to begin with. And in fact, maybe it's preempting. I would encourage that as well. You can think of your design and translate that. Maybe you'll focus on designing for and enhancing or establishing a much more seamless or frictionless customer journey experience.

If you focus on what you're trying to deliver, and then think about, Well, how do we measure as we go along that journey? Or what if you want to call it a process? The model becomes self-evident. You are creating the model at that point by just plugging in maybe a few simple measurements to begin with. Let's not even go to the metrics definition, but just some measurements. The measurements can be how many, how few. etc. So, there's no expectation immediately attached.

What translates from that sort of analysis, or sketching out what that could be, into a model is when you start attaching expectations. Because why do something otherwise?

You turn the discussion around then from something that may be slightly intimidating, to something that's very exciting. And you will get significant contribution. So, you compose the questions: What does the user, person, actor, character get out of this by your design path that you followed here? What you’re actually going to get, I think, is going to be extraordinarily positive. “Well, we're doing this because we envisage that this will happen, and this will happen.” All of that energy, then, that you can create is what's needed to translate into, let's call it the simple model. And you don't have to call it model by the way! It helps, but it doesn't have to be. And what you're gaining then is a much better alignment with your design approach and closer proximity to the customer, their organization, their domain.

The other intimidating factor for the designer can be, “Well, you know as a designer, I'm designing for something that I don't really fully understand. I’m not a domain subject matter expert in this area.” And that could be a barrier. You can actually approach as a customer success, or a customer experience expert where you can bring your own design approach to that problem space and ask the right to questions.

Because at the end of the day you're designing for people. And the people aspect of it is what Design should drive, and that superior understanding of people.

That's the skillset Design is bringing. Remove the domain context. That can be created by other experts that are around. And that's your focus there as well. So, it’s simplifying, de-mystifying, and organizing these processes. And that should be what senior leadership is demanding to see as well, how this helps them further their business objectives and performance goals.

Design Understanding

X-Mentor: Do Executives still struggle to understand what Design is? And what Design would bring to the business?

Peter: It's a mixed bag, Greg. I think you can certainly point to certain industries and areas where design is recognized as being fundamental. And I’m a great fan of always learning where people have embraced an approach and proven to be successful and see how they've achieved some of that. Conversely, there’s organizations that struggle with Design, typically they’re somewhat removed for whatever reason, from their customer base. And they think about the products or services they provide, that's the first stop, rather than the customer aspect.

So, I’ll give you an example of an industry that has embraced Design and is being challenged in the design approach. The automobile/car industry. I think, if you step into that world, car design, coming up with a new car. The new model is probably one of the most challenging design projects you can probably be involved with. Typically, it can be make or break. It has to consider a really customer-centric approach. You can't take anything for granted. Competition is obviously fierce. And what I really appreciate; It has to find the balance between engineering, let's call it the cultural aspects, the economic aspects, and the environmental aspects. Nowadays, you must have the design context for all of those, but trust the people you're working with, those experts in those areas of supporting all those efforts as well.

If you look to other areas, Designers can be seen as more remote. The worst example that I've come across is to think of Design as: “Why, isn't that [Design] something they just do to the website? Isn’t that [Design] just about the color, fonts, and a few images? How hard is that?” So, [Design] is diminished. I think you'll see that organizations that are remote from customers, are also remote from Design. And they reduce it down to trivial context and scope, as opposed to the fact that Design fundamentally fuels your brand. And this is where I'm going with how leadership needs to think about it – Design fuels your brand. The [brand] recognition, memorability, emotional attachment “Apple. Great, great!” you know. Obviously one of the most premier examples of that.

There's learning to be gained from both sides. So, don’t diminish, don’t trivialize. If you are customer centric you’ve got to put design in the center or the hub of your approach to how you work with your customers from a 360 point of view as well. It's not, maybe once the customers signed up design kicks in. It's the full customer journey experience.

Actually, I'll return to the example on the automotive side from the car manufacturers. I think of the tremendous efforts into that customer design and success. When it comes to how we, as individuals, buy cars, that part of the journey is still, I think, who's got tremendous scope for a design approach. It's handed over to dealers, and so on, and I’m sure we've all been there. The experience quality falls off very quickly.

I think it's one of the great examples where somebody has invested millions and millions of dollars coming up with let's say, you know, a brilliant new car experience. But somebody walking into a dealership and having a poor experience immediately, they walk out again. And you've lost!

Simple vs. Complex

X-Mentor: What can Design Pros do to become even more essential to the business?

Peter: Yeah, it's a really important one. It's again not to be confused with someone from the Design side becoming a subject matter expert – that's not needed. Let's be clear on that.

What's needed is to understand what the customers are trying to do in terms of the goals, jobs, roles with your service or product offering, and why? And that is not a subject matter expert definition. That's a simple, clear understanding.

And if that cannot be understood simply, let's just call it regular speaking talking points, then there's a clear indication you're not understanding the business domain. It's a really good indicator there. Complexity is just a way to see what's really going on. Everything can be first represented in pretty simple forms and understood – most importantly understood in those forms. And that leads into what can be designed. The design approach should start with the simple premise, not the complex premise. That's what you're trying to get, I think initially. And that will fuel so much of your “designed for” process there as well.

Another good way, Greg, is people understanding the analogy. Use the analogy to explain and understand. It's a conversation like we just having. “Well, is it like this? As I understand it? And I've seen it and experienced it? Or is it like something else?” If it's like something else, tell me about it. I'm interested. Why do they do that? Why do they think about that? And here’s a really important thing you get out of that. Having that conversation, let's call it, you start to understand or identify a design of the preconceptions or notions that are held, on both the business side and the customer side, that you in your design approach can overcome or remove. They're artificial, because of original constraints or things like that. But it provides a viewpoint, a way of looking at things that you need to embrace from the Design point of view. By the way, that can be reflected up to the rest of the organization, particularly senior leadership as well.

Surprisingly, senior leadership teams are quite often open to getting a better understanding of their own business and their customer base. And backing that up there with formal research. But typically, the data is around to understand that as well. It’s something that needs to be embraced, and not avoided because it seems intimidating or hard, or viewed as “I've got to learn something.”

I'll give you just one digression on this. In the space I’m working with at the moment around advanced analytics and optimization, “Optimization” speaks to very deep, very domain-driven mathematical optimization. I am not a mathematician. Nor do I possess that capability to go to those levels. What I do is look at what it can achieve in the context of what customers are trying to do. That is an exciting point! I even explained it by simply saying: “Can you imagine having the performance indicator?” Imagine a related set of metrics or KPIs, where some of those are red, some of those are yellow, and maybe only one is green, and “your goal as an organization is to get everything green.”

Now, wouldn’t it be wonderful if you could ask the system:

“Show me how I can make everything green.”

Design-as-a-Hub

X-Mentor: How can Design be optimized for business impact?

Peter: So that really goes back to the point I was making of redefining Design as a Hub. It has a unique advantage. One of the challenges for a modern organization still, is people or functions acting in silos. You go to most organizations, and you have a quick conversation. See a little more and you get a pretty clear picture that they function in silos. Big issue then is, at the senior level, you're looking across the organization and trying to manage. But in reality, decisions are being made in silos, with very little context to how they impact other parts of the organization. Because you are establishing Design as a Hub that’s looking at the customer journey, it cuts across all those silos.

Immediately, you can get a relatively simple, but very important, relationship that can be explained and analyzed across those different silos. Then you can take it whether it's looking at marketing, or could be procurement, or other areas. But that journey across and plotting that out, it’s fundamental.

Today I'm working in the space on supply chain for a lot of organizations. Massively siloed! The innovation that's happening in the marketplace there, Greg. I don't know if you’ve come across the term. But now you're getting “supply chain lighthouses.”

What's the supply chain lighthouses? It’s a collection of metrics that give you visibility across your supply chain. Not decision making yet – just visibility.

Now, if that was done in a way that plotted out also the customer journey experience, that would be the next step to evolve. That gives you the idea of Design as being centric as a driver for this business domain but making it simple and practical.

It Starts with the CEO

X-Mentor: Who’s job should it be to track Design Impact on Business Outcomes?

Peter: It starts for me with the CEO. No “ifs” or “buts” around that. I’m not saying that they do it. But they need to recognize it. And need to establish accountability and the alignment for that. Now, having said that, that means you can then formulate how you're going to operationalize that. It can be, and we see more prominence around the practice of customer success as getting more and more scope in this area. That could be one avenue that would to me seem a good path to go because it's building off specifically a customer centric set of metrics that you can then look at how they relate to operational metrics, etc., etc. If you don't have that approach, you need to see where those collections of customer success metrics are currently situated and use that area to grow and establish from because they need to be at the core of what you're trying to achieve. You can do the review, have we got the appropriate metrics, etc., etc. That's the way to think about it. Because it's a natural evolution path that you’re setting up.

Establishing Team Composition & Dashboards

X-Mentor: What would the ideal team composition look like for Design-as-a-Hub?

Peter: That's a very interesting one, because it could be intimidating, or worrisome, because you think: “Well, now we've got to go out and hire X more designers” to establish design as a hub and interact with all these other functions as well. I think the answer to that is, you don't need that. It goes back to the good old performance management practice of establishing your dashboards, that have that design-centric aspect as part of their own design.

So, the relationships across the organization are established through the way that you will manage is interrelated as well. That requires a bit of design. Undoubtedly.

But here's the key: It's relatively low cost. It can then be used to gauge what I think will be a very high ROI on that approach.

Why?  

1.       It will remove redundancy reports. We talked about the exponential growth of the number of reports, etc.

2.       It will provide focus, what's important, and get agreement on that.

3.       It will also provide early warnings, and the ability to look at mitigations and opportunities across the business.

It's the learning, I can tell you now from supply chain lighthouses, Shining the Light across the full spectrum immediately, you see where problems are. If you think of that in Design terms, you're on the right track.

Innovation Untapped!

X-Mentor: What would Design-as-a-Hub ideally look like?

Peter: I think it will be the innovation driver for organizations. Because it creates the context for that innovation. We've all seen the problems you can get: “Hey! I know somebody who's come up with a really cool algorithm… blah, blah, blah!” We're now trying to find a home for it. The “really cool piece of code” or something like that. Try to find a home, or a feature, a function. That's a very expensive, wasteful way of trying to bring innovation to your base. Design, and remember what I said about Design, will identify what are preconceptions. Or barriers or stuff! That is just plain “Why would the customer be doing that?” I mean. “Don’t they realize they’ve got options? We can provide options.” We can find new ways of doing things through Design.

The real big picture, it becomes the evolution from Design Hub to Innovation Hub. Because design-centric, per the car analogy, includes at that point engineering, all the environmental aspects, etc., etc. That is for me the opportunity that's sitting there.

Even with those organizations that report to be fully customer-centric, that innovation is still, I think, untapped. So even in the state of the Apples of the world, we probably would put Amazon as having that notion of being very custom-centric. We appreciate their service at various times, I'm sure. But Innovation? Interesting question. It seems to be that, Yeah, that still remains I think untapped. You have to have the “objectively paranoid” in your space that we are not worthy or good enough for our customers and always be thinking along those lines. That no, we haven't done everything we can – Yet!

X-Mentor: There is this tension I'm sensing between the mindset of leadership that just wants to perpetuate the status quo. We've seen that, right, “…don't do anything to undermine or cannibalize the product.” Say, Excel, for example… “Bill Gates.”

Peter: I was going to say the same! [Laughs!!]

X-Mentor: Versus, literally go out there and find an unmet customer need, a new market opportunity, and to bring back these opportunities to solve a real customer pain. Then there’s the challenge of making a compelling case [to Finance, Senior Leadership, etc.] for coherent action. This would normally require modeling things out. However, it sounds like “Modeling ROI” might be the wrong way to think about it. Correct?

Peter: It might be Yup, yup!

X-Mentor: So, what would you say might replace that word “Modeling”?

Peter: Ah! That's a great question. Let's call it the innovation of your journey that we want to take our custom on. Because why else would you be doing it if not to improve things? To be given that opportunity, I think, is a tremendous responsibility, but it is also very exciting.

X-Mentor: It sounds like if we replace “Modeling” with “Innovation,” then it's about trying to understand what Design can do to yield better innovation, which then yields better operational, and ultimately financial outcomes. Is that a way to think about it?

Peter: It’s spot on. Let's just use your Excel analogy there and say, you know, if innovation is not the name of the game, you would say to Microsoft: “Great! So, you don't need to do anything else to Excel – it is done. Nothing else to do. Move on, Redux people who work on it, let them go do something else then.” Great! Because you play that back, and no one, I’m sure, as we know them pretty well, would say: “don't do anything else with it. Are you mad, though?” “We have so many customers who use it.”

Exactly! So, let's call it what it really is. What are you trying to do for your customers. We're still looking at ways to improve, and “improve” is the code word for innovating how they can do things.

And I’ll be honest, I've seen some marvelous things come out of Excel in the last few years that have surprised me. That’s wonderful! More than surprising, it helps me do things, and I still use Excel, in ways that I can do things that I couldn’t do before, or I didn't even think of using Excel to do. Brilliant! That's what I want. Delight, surprise, and encourage me, as the customer and I’ll embrace it. And I’ll want more.

X-Mentor: Peter, this has been fantastic! I really appreciate you coming on the X-Mentor and sharing some of your insights and advice. I've always appreciated your unique ways of seeing the world and putting complex ideas into simple contexts.

Peter: It's been fantastic, Greg. I really enjoyed it! I'm looking forward to seeing how The X-Mentor program evolves any debates.

ABOUT THE AUTHOR(S)

Peter Bull is the CTO of River Logic, A Leading Advanced Analytics Company.

Greg Parrott is The X-Mentor and publisher of The X-Interviews.