Everyone loves a good hack

Is holding a 'hackathon' a good way to drive innovation inside your business?

David Gee (CIO) on 12 December, 2014 09:32

In this age of cyber security concern, it is amusing that the word “hack” has entered our lexicon. The word has never had a positive connotation and in my view, it’s always a negative. In golf parlance, a “hacker” is not a description that anyone wants to be labeled with.

Wikipedia defines a hack as an inelegant but effective solution to a computing problem.

From the notion that this is about breaking into a computer network, through to the Facebook programming language – there are various meanings attributed and all appear not to be favourable.

But several large enterprises are jumping on the hacking bandwagon, particularly financial services firms, holding their own “hackathons” to create new, innovative apps and solve issues that plague their businesses.

Westpac held a hackathon at its recently opened ‘Hive’ innovation centre. National Australia Bank and Commonwealth Bank (CBA) have also held hackathon events.

I attended the CBA hackathon that was held at the University of New South Wales, where 50 students spent two and a half days hacking retail technology to create a product that would provide a seamless experience for retailers and customers.

The event was very well run and I was immediately impressed with its focus and the capability of the students who were participating.

We can be cynical and say this is all about getting something for nothing, but actually CBA had one of its executives provided great context around innovations in retail industries. He used examples from retailers Hointer, John Lewis, C&A, and Shoes of Prey.

Hointer’s jeans hang down from the roof of its stores and are scanned and sent down chutes into the customer’s assigned change room. This speeds up the process of buying jeans and improves the overall experience for the customer.

The second example, Shoes of Prey, is an online business that enables consumers to custom design shoes – a great example of a micro segment customisation.

You could sense that the audience of students were impressed with the innovative case studies that were shown and there were audible gasps.

Another CBA exec explained the bank’s ‘Albert and Leo’ purpose-built tablet devices for payments. These devices run CBA’s Pi platform, which features an app store that would house the most successful apps created during the hackathon.

Essentially, the teams had an open license to tackle whatever problem they desired. There was a bounty cash prize on offer for the best app that came out of the four day event and also an internship up for grabs.

Winners and losers

It is a cliché but I’m not sure that there are losers in this instance, those who toil away for several days and their product doesn’t get recognised.

But there are winners of course, lucky teams of developers who create something truly innovative.

A group called CrowdSauce won the CBA UNSW Hackathon with an app for self payment that incorporated user ratings. This was an interactive menu that you use at a restaurant to self order and pay while also seeing what other diners are ordering.

 

I like the social aspect of this, although it may sound creepy and in certain pubs to become a talking point of what you are eating or drinking (perhaps a replacement for dating apps?)

The team – Isharn Varshney, Sohaib Mushtaq and Pavs Raju – delivered a validated solution and business model with evidence of a prototype.

A hackathon is no marathon

Hackathons are essentially ‘sprints’, and are about creating a minimum viable product.

YouTube stars, Ankit Gupta and Akshay Kothari from the Institute of Design at Stanford created a ‘named pulse’ for a project. This app displays news from multiple RSS feeds in one page using a tile interface.

Well, guess what? It was purchased by LinkedIn for US$90 million. Legend has it that the students created the app in five to six weeks.

The other key success attribute when creating innovative technology is your ability to be nimble and avoid hierarchy. So the size of your team matters.

It is interesting to note that McKinsey consultants have teams of 4 or 5 as does the US Navy Seals. Once a team is greater than 5 or 6 then coordination becomes the focus not the work.

Professor Bob Sutton from Stanford refers to the work by coincidently named Richard (Hackman) at Harvard. In short, Hackman’s rule is that ‘big teams suck’.

I think, he’s right. It gets harder as you add more members to the team and like it or not the communication becomes harder and roles become more splintered.

Let me close by noting that a ‘hack writer’ is a person who is paid to write quick inferior articles. Not that I resemble this!

But in all seriousness, is a hackathon something that CIOs should organising to create innovation inside their businesses? My belief is that hackathons are just one tool that can be used to garner ideas especially from an external group.

For the CIO, there are many other approaches to injecting innovation, including innovating with external partners, engaging a startup accelerator to run a program for you or building an innovation lab. The list goes on.

Hackathons are just one piece of the puzzle and whether or not they will continue to be used by corporates to create innovative products and services remains to be seen.