3 Box Theory

Elements

3 Box Theory | to be future ready

Adopting Innovation and its foundation•Business Thinking Vs Innovation Thinking•Fixed Mindset Vs Growth Mindset

Growth Mindset Explanation

Case Studies | Integration of Resources

Future of Automotive Sector | Shift from Transactional to Customer Centric approach

Future Expectation•Managing trust and complexity throughout the customer life cycle to maintain customer loyalty•Rethinking value propositions

Re-innovation and its importance

Box-2 & 3

Short Term Approach of securing profits in current business by •Cost Reductions •Margin improvements•Focus on todays customers, technologies, competitors•Centralized resource allocation •Leverage current competenciesApproach Methodology•Competition for the present

Long term approach of sustainable leadership by• Innovation• Process Management• Focus on tomorrows customers, technologies, competitors• Decentralized resource allocation • Build new competenciesApproach Methodology• Competition for the future

Box

-1Bo

x -2

& 3

3 BOX THEORYTo be future ready

Box 2 & 3| Adapting InnovationBusiness Thinking vs. Innovation Thinking

Innovative thinking is a crucial addition to traditional business thinking.

It allows you to bring new ideas and energy to your role as leader and paves the way to bring more innovation into your organization.

Slow DownReflect

Approach

Don’t just jump to the most logical conclusion

Reflect situational analysis

Approach the situation in an unconventional way of using INNOVATIVE THINKING

We are Business thinkers which is an outcome of our thought process. To make company grow we need to come out of BOX 1 and plan our journey to BOX 3. It is not about discarding the business thinking. It’s about acknowledging that both exist and that productive new products and services will result from finding the delicate balance between the two approaches.

BOX 1 BOX 2 &3

Many of today’s problems are critical and pressing, and they demand quick and decisive action.

Box 2 & 3| Foundation of InnovationFixed Mindset vs. Growth Mindset

Fixed Mind Set Growth Mind Set

Avoid a Challenge

Gives up easily on a Obstacle

See Effort as fruitful or worse

Ignore useful negative feedback

Feel threatened by success of others

Embrace a Challenge

Persist in the face of setbacks

See efforts as a path to mastery

Learn from criticism

Find lessons and inspiration in success of others

As a result, they may plateau early and achieve less than their full

potential

As a result, they reach ever-higher levels of achievement

A mindset is a set of • Assumptions• Methods• ideas

In practice, mindsets are everywhere around us, as evident by people’s adoption and acceptance of certain behaviors or choices that are already established; most often, these mindsets are referred to as rules or conventions.

We can shift to any growth mindset at any time. Doing so shifts your thought processes to be collaborative, open, authentic, empathic and relevant.

“If I can do it, so can you, which is why I encourage you to embrace a growth mindset and unleash the creative, problem-solving innovator that resides inside of you”

Box 2 & 3| Growth Mindset

What is mindset?A mental attitude that determines how you will interpret andrespond to situations

The distinguishing feature of geniuses is their passion and dedication to their craft, and particularly, the way in which they identify, confront, and take pains to remedy their weaknesses

IN OTHER WORDS…It’s not what you are born with that matters;it’s your mindset that matters

The last of the transition stages, is one of acceptance and new energy. People have started to embrace the change initiative because they have begun to build skills to work in a new way and they are starting to see some wins from their efforts

Stage 1 Ending, Losing and Letting go

Stage 2 The Neutral Zone

Stage 3 The new beginning- MAKING OF A SUPER STAR

This stage is often marked with emotional upheaval and resistance, because people have to let go or give up something that they are comfortable with or that is routine.

People most affected by the change are often confused and uncertain during this phase. In fact, in Stage 2, they may experience a higher workload as they work to get used to new systems and new ways of working.

Process of Mindset Change

CASE EXAMPLE | INTEGRATION OF RESOURCESOptimal utilization of resources available

Satisfied Customer Potential Referral Point to generate referral sale

Customers reporting to workshop Potential Referral Point for VAS+ Vehicle Exchange

ETR/GTR Customers Potential Referral Point for vehicle purchase Body Shop inflow

Potential Referral Pointfor vehicle exchange + VAS

TD IFIR Potential referral point

for vehicle sale

Exchange evaluation forms Potential referral point

for vehicle sale

Lost Enquiries Potential referral point

for vehicle sale

Enquiries Potential referral point

for vehicle sale

Existing Customer Potential Referral Point for VAS+ Vehicle Exchange+ Referral Sale

Customers buying TMI/VAS Potential Referral Point for creating a reference sale

In a span of

1 year an average dealership with a volume base of 15 retails a month will have minimum

4500 customer base to sell tangible product or service

1% conversion change will lead to a monthly retail increment of

25% Cust

omer

Touc

h Po

ints

- 1

0 So

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s ava

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appi

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n Innovative use of data available at a particular dealership though integration of Sales and Service domain can create wonders. Monitoring 10 sources as depicted below will lead to change and improve efficiency of entire value chain

Opportunity to sell will be limited because of growing competition, How smartly resources can be utilized to the optimal level will be a key factor in deciding organizational growth

Transition from BOX 1 to BOX 3 will create a sustainable competitive advantage

There have been four distinct jumps to be considered as “business models” in the high jump. Each has enabled athletes to achieve breakout performance:

Scissors

Eastern roll

Western roll

Fosbury roll

CASE STUDY| HIGH JUMP OLYMPICSUnderstanding innovation as a Business Strategy

Box -1• “Scissors” Business Model winning

depended upon being the best at that technique

• From Business perspective they are competing on cost, market share, and margins.

Box-2 & 3• Western Struddle Fosbury Flop

• These nonlinear shifts exemplify Box 3 thinking. Each transformed the high-jump “industry.”

• From Business perspective they focused on innovation

Early on, the “scissors” style dominated All high jumpers used the scissors

approach Winning depended upon being the best at

that technique

With a predominant success rate of defined techniques it was no more a competitive edge. To change the dynamics rules of the game were changed: For 25 years western roll were in place After 25 years Eastern Roll was invented And then Fosbury was used to sustain

predominance and all records were broken.

FUTURE OF AUTOMOTIVE SECTORShit from Transactional to Customer Centric approach

“Achieving this transformation in automotive retail will not only require a concerted effort from both automakers and dealers, but will also demand an unprecedented level of collaboration with other stakeholders in the ecosystem, particularly insurance companies, auto finance and aftersales market participants.

For dealers, the transformation is a significant opportunity to streamline their operations by shedding non-value-adding functions and unlocking capital from redundant infrastructure, while taking on a wider service portfolio that contributes to better margins.

In the short term, there is a clear need for stakeholders across the automotive retail ecosystem to undertake significant change management to catch up with the broader retail industry. This is an executive summary of our analysis of the future of automotive retail, where we discuss the key forces at play and steps that stakeholders in this ecosystem should take to meet the needs of customers, and remain relevant and competitive.”

Customers are able to quickly interact and easily access information across media and devices — anytime, anywhere. This needs to reflect in the customer experience and marketing strategies.

Automotive retail will shift from a product-driven to a customer-centric approach to drive customer loyalty and to adapt to changing customer behavior and expectations.

The rise of new mobility concepts and shifting mobility preferences of private and commercial customers (e.g., private and business-car sharing, electric vehicles and an increasing role of used cars and fleet) are causing automakers and automotive retailers to rethink their current business model.

Increasing Customer retention rates by 5% increases profit by 25% -95% Source HBR (customer service experience)

Many people restrict their strategic thinking to Box 1.

This tendency has been particularly acute in the past two to three years, as most leaders have emphasized reducing costs and improving margins in their current businesses.

But strategy cannot be just about securing your current status it needs to do to secure profits for the next year. Strategy must encompass Box 2 and Box 3. It must be about what a company needs to do to sustain leadership for the next ten years.

To make a difference over long periods of time, you must emphasize on all three boxes • Innovation creates a new model (Box 3), which, at some point, becomes

an established models for others to follow (Box 1). • Before the established model matures and dies, selectively forget the

past (Box 2) and again engage in innovation.

This is a dynamic and rhythmic process, one that never ends.

Challenge is to implement breakthrough idea effectively which will ultimately lead to performance as desired.

RE-INNOVATE TO BE COMPETITIVE Sustainable competitive advantage

Innovation

(starts here)

New way of working (Box 3)

Establish way of

working (Box 1)

Ends here

Performance

Execution key to success

99%

Adapt to Change Innovation “ the game changer”

Be the Change !