Abstract: The systems being designed and built today are often complex and disparate, making it difficult to evaluate the profitability of large initiatives (e.g. projects). Businesses need predictability as well as agility, to ensure value delivery, profitability and growth. Unfortunately, the traditional financial indicators used to estimate risk and productivity for today’s modern systems (e.g. NPV, IRR, MIRR, etc.) are insufficient to measure returns and risk of large and complex systems in environments that are high in uncertainty. To address uncertainty and increase speed to market, a different kind of accounting framework is needed to quickly validate product assumptions and increase learning.
By attending this workshop you will learn how Innovation Accounting can increase business agility by reducing waste and leveraging fast-feedback to improve economic outcomes for large initiatives. Using the workshop format you will use hands-on exercises to learn and apply leading indicators (vs. vanity metrics or traditional KPIs) to decide when to pivot and when to persevere, how to reduce sunk costs, and increase value delivery. Innovation Accounting is a term coined by Eric Ries in his book The Lean Startup.
Learning Outcomes: - In this talk we discuss the Innovation Accounting and practical ways to apply it to large initiatives for today’s complex systems. Attendees will learn:
- - Realize the practical ways to apply Innovation Accounting to large initiatives.
- - Consider how to implement an MVP and pivot or preserve decision using build-measure-learn feedback loop.
- - See the value of developing and utilizing leading indicators as metrics rather than agile vanity (or lagging) metrics.
- - How to prioritize initiatives using economics to maximize business agility.
- - Specific implementation examples.
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