Final presentation for Chuck Eesley's 'venture lab' Stanford online course on technology entrepreneurship. The slides present a cloud based data analytics approach to organizational complexity reduction.

1. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
O RGANISATIONAL C OMPLEXITY
R EDUCTION
@ INTERSECTION OF CONSULTING AND LARGE SCALE DATA
ANALYSIS
August 28, 2012

2. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
P ROBLEM
complicated processes not aligned with structures can kill
productivity
estimated complexity cost per employee: 20 − 40% (cf.
market research)
how to efficiently measure, align and manage complexity in
organizations?
Starting Point: organisation is a networked ’complex adaptive
system’

3. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
S OLUTION : CO MPLEXITY RE DUCTION
CORE assembles a customized set of algorithms analyze
communication data
align organization structures and processes with needs
reduce mismatch, stress, inefficiencies
manage and reduce complexity in modern organizations
by analyzing communication processes, we suggest
adaptions and help to align structure and processes

4. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
E XAMPLE C ASE
Setting : You want to find out why your productivity
decreases
You know that
departments tasks are communication intensive
workload has increased
some customers & employees have changed
customers’ requirements have shifted repeatedly.
Internal Project Team : Little succes due to
Lack of time
People have not dared to speak up you only find out
what you already knew
these are not the actual problems
Weak Signals : You know that your colleagues talk about
quitting after one key member has left to a competitor,
another one has switched internally and your bosses have
started to question your departments performance.
You are getting nervous! VERY NERVOUS!

5. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
E XAMPLE C ASE : S OLUTION
Silver Lining:
You hear about CORE, the solution to analyze
organisational complexity
You decide to implement a testcase in your department.
Email data is anonymized and exported to analyze
communication patterns
Approval of the worker’s council, which is concerned about
privacy, but also health issues of your departments
members is reached.

6. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
E XAMPLE C ASE : S OLUTION
Analysis: The analysis shows that
internal and external email communication increase after
customer employees have changed.
much higher communication load on customer facing team
members.
other members of the team are communicating a lot with
each other in circles.
Action: You cut away on internal processes that produce
unnecessary communication and move freed workforce to
help customer facing employees.
Results: Team mood and productivity rise, newly
developing unnecessary processes are identified early on
and cost stay in check in the coming months.

7. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
E XAMPLE C ASE : R ESULT – C OMMUNICATION
N ETWORK
Figure : Anonymized analysis of ENRON example dataset – subset of
all emails

8. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
C ORE T ECHNOLOGY
CORE Technology computes complexity indicators based
on
person-person communication network
information originated in-and outside organisations
Indicators show organisations how to optimize tzeir
processes
align process and structures
reduce complexity
improve performance in terms of speed, flexibility ,
integraion and innovation

9. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
C ORE T ECHNOLOGY AND P ROCESS

10. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
M ARKET R ESEARCH
our survey results indicate yearly complexity cost of
20 − 40% of total employee cost
estimated total market size for Europe: 2 bn Euro p.a.
target group: more than 43.000 medium sized enterprises
in EU with 250+ employees, estimated useful minimum
size: 100+ employees
Gartner’s Analytic Applications and Performance
Management category: 1.4 bn USD revenue, 8 − 15%
CAGR

11. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
C OMPETITION AND UNIQUE C HARACTERISTIC
competition:
fragmented academic and small consultants
large person-hour focused consulting companies
data analytics software providers
business performance software providers
no integrated, semi-automated, data analytics, domain
know-how based approach
This is where CORE steps in.

12. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
S TRATEGY
Incremental approach in design / prototype phase:
feedback from market
start with SaaS based email analysis for medium sized
companies in
local markets
build team
form partnerships with consultants and academia as
multiplicators and sales channel
Scale up and Long term perspective:
increasingly larger enterprises
extend to ERP data based analysis of processes
extend to IT complexity reduction

13. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
M ILESTONES / I NVESTMENT
Investment characteristics incremental learning: assumes
bootstrapping at beginning, angel / VC investments later
further development required: 6 months, after that ongoing
development
first sales: year 1
building sales: year 2
positive cash flow in year 3
profitable in year 4
sales of 2.5 Mio e in year 5
Investment, staged: 1.5 Mio e for development, initial
growth phase
core software development team
build up of
sales team and customer base
partnerships / channel sales

14. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
S OFTWARE D EVELOPMENT
Status:
protoype analysis and visualization
based on 423mb, 300k emails ENRON data set, standard SNA algorithms
next: alignment with orga structure
Software Development Approach:
internal core R&D team to develop and prototype
outsourced high performance implementation
SaaS platform, integration software, data extraction
software (low value code) outsourced to cost efficient
supplier
deploy platform in cloud & grow along revenues
use open source tools to reduce capital expenditure
personal data issues managed per country, current
prototype is based on strict European regulations

15. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
C URRENT CORE T EAM
mainly European multidisciplinary team with experience in
network theory, social networking, corporate organisation
and enterprise needs
met on Venture Lab based on passion for algorithmic data
analytics solution to complexity problem
Carl Henning Reschke, Consultant & Innovator (GER)
Sven Stodtmann, Ph.D. Student (GER)
`
Francesco Collova, Innovator, Global Architecture Expert
(IT)
Roger Sen, Enterprise Application Expert (ESP)
Mentor: Benson Yeung, IT architecture and systems
integrator (USA)
Input from informal advisors from VL and RL

16. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
S UMMARY
complicated, interrelated processes not aligned with
structures and incentives kill productivity
estimated cost of complexity 20 − 40%
estimated market size Europe alone: 2 bn e p.a.
cloud based data analytics for organizational alignment
and complexity reduction
achieved prototype analysis of example ENRON email
data set
incremental development, initially organic growth strategy
followed by expansion

17. T HE P ROBLEM E XAMPLE C ASE C ORE T ECHNOLOGY M ARKET R ESEARCH S TRATEGY T EAM S UMMARY
C ONTACT & L INKS
Team http://www.venture-lab.org/teams/5693
Web http://www.coredux.appspot.com
Youtube http://www.youtu.be/bQBTuG0g3AU
Survey http://www.surveymonkey.com/s/QDLYVNT