1. Innovation Leadership Training Day Two Trends February 6, 2009 All materials © NetCentrics 2008 unless otherwise noted

2. Welcome We’ll spend the next hour or so examining the concept of trends, trend spotting and trend synthesis

3. Pre-work Each of you were assigned the task of identifying a number of relevant trends – societal, demographic, technical or competitive trends – that could impact Pacific What competitor keeps you up at night and why? What firm could disrupt your service or industry?

4. Discussion What trends did you identify? Why did you focus on those specific trends? What’s the probability the trend will continue and that it will impact your business? Can we combine these trends into a more significant view of the market and how it is changing?

5. What We Want to Accomplish

6. Goals for this section Our goal this section – Identify trends and other market insights – Gather and synthesize trends to identify “threads” or key concepts – Understand how to communicate the findings – Incorporate the learning into your innovation strategy

7. Key Points Many of us are aware of certain trends, but we often fail to aggregate these trends – We tend to have a very segmented view of trends but trends can have broad influence We need to think about trends as ingredients in a larger recipe or pieces of a larger puzzle – Synthesizing the information is even more important than capturing the concepts We need to use the trends and the synthesis to drive a new strategy

8. Gradually, then suddenly There’s a famous line from the Great Gatsby where a former millionaire is asked how he lost his money. He replies “gradually then suddenly” A lot of the changes in our businesses and markets can be identified before they happen if we pay attention to the subtle trends and red flags early enough

9. Trends As part of your homework you identified some trends Here are a few more – Cost of university education on the whole rising faster than inflation – Greater demand yet little increase in “slots” – Questions about the value of the education given the costs

10. Synthesis What do the previous trends tell us? If we synthesize those trends and project them, we could determine: – People believe the education is important – Have a difficult time getting accepted to their first choices due to high demand – Can’t afford or justify the expense based on the expected return Net net – prospective students seek alternative education methods/approaches

11. Who is your competition?

12. Result University education is compared to other forms of work where education may be offered or enhanced, or to alternative forms of education

13. Discovering Trends Formal discovery – Market research – Voice of the Customer – Ethnography – Interviewing customers – Industry data – Tradeshows / Conferences – University or third party research

14. Tradeshows/Conferences Many Pacific employees attend educational conferences, analyst conferences and other conferences. What are their responsibilities to identify and report new trends and information? What events, shows, conferences are you missing where important information is released?

15. Collaboration/Research

16. Discovering Trends Informal Discovery – Watching your prospective students – Reading the complaint letters – Acting as a customer – Reading blogs and other market commentary – Watching and understanding societal trends

17. Quote

18. Where to find trends Sustaining / reinforcing trends – These are trends that seem to reinforce the status quo. These can be found by talking with existing customers and competitors Transforming/disruptive trends – These are trends that will upset the existing order. Talk to people who aren’t interested in your product or service or who don’t need it or want it.

19. Primary and Secondary Discovery Combine a “formal” discovery process using methods like market research with informal discovery to gain a more complete picture of what’s happening Poll your teams to find out the complaints, reasons for joining and reasons for leaving

20. Other sources CompanyWeb AddressDescription PSFKwww.psfk.comGathers and publishes trends Outward Insightswww.outwardinsights.comCompetitive Intelligence Fuld & Companywww.fuld.comCompetitive Intelligence Trendwatching.comwww.trendwatching.comGathers and publishes trends Trend Hunterwww.trendhunter.comTrend spotting magazine and website Census BureauChanges in the US population

21. What sources do you use? Can you list some other sources of trends that you or your team use? Especially focus on external, third party sources of insights or trends

22. Analysis Trends must be carefully analyzed – Which will fizzle out? – Which will become “fads”? – Which indicate a real change in expectations and behaviors Beware of too much emphasis on one trend or one data point Seek to combine and synthesize the insights

23. Synthesis Once we’ve identified sources of trends, next we need to aggregate and synthesize those trends This means determining which trends are “valid” or more probable, and which trends are likely to be combined into a larger reality This is a relatively intensive human effort, but can pay tremendous benefits

24. Synthesis Identify which trends are important to your industry Which are likely to continue and what implications they suggest Which you can ignore Which trends may combine with other trends to create a lasting new need

25. Scenarios and Implications Once the trends are synthesized, we need to project the scenarios or outcomes that are implied based on the selected trends This means we need to move away from considering any one trend, but looking at a number of trends simultaneously and understanding their implications Doing this enables us to build future scenarios

26. Key Takeaways Some one or some team should be watching and evaluating trends constantly These trends should be gathered through formal and informal means Using internal and external sources Once gathered, they must be synthesized to develop a model of a possible outcome The implications of that outcome must be developed

27. Exercise