ICE Diagram

The ICE Diagram is the last document presented in the Evaluate phase of the methodology. ICE stands for Identify, Control and Evaluate and it is a table composed by three main columns containing the elements defined by the acronym.

The Balance Scorecard is the starting point from which the ICE Diagram begins. Its aim is to translate issues and opportunities into tangible actions which are continuously implemented and evaluated by valuable metrics representing the comprehensive internal and external context in which the startup operates. Indeed, the tool identifies problems which present different levels of priority, spots solutions related to them and, finally, sets

49 G. Perboli (2018)

50 G. Perboli (2018)

90 KPIs to monitor the performances generated by the identified actions, as represented by table 12.

Table 12: ICE Diagram Table

For these reasons, the development of the tool requires, also, the completion of the SWOT Analysis, previously described, because it enhances the brainstorming of threats and opportunities faced by the business at high level. It is built by three main steps which bring to the final outcome, as anticipated:

1. The first step selects and identifies the opportunities and/or problems affecting the startup, taking into considerations the ones spotted in the SWOT Analysis;

2. The second step defines the actions/solutions required to exploit the identified opportunities and handle the problems in the Control Column;

3. The third step, the Evaluation column, is divided into three sections:

• In the first one, the key points indicators, KPIs, needed to evaluate and monitor the action to be implemented are defined to take track of the business performances and evolution;

• The second section establishes the financial resources required to develop the actions identified by the Control column;

• The last one considers the time scheduled to implement and complete them.

The outcome generated by the ICE diagram provides the results used as input by the Solve phase, following phase of the methodology.

The ICE Diagram to be efficient must be customized based on the business model proposed by the organization and its profile, prioritizing the actions which supports the sustainability of the startup.

The prioritization of the operative actions is due by two main reasons, viewed from the financial and the internal perspective of the organization:

1. The economic budget associated to startup is generally limited and cannot cover, usually, all the action identified in the same time horizon;

91 2. The management of the totality of the actions at the same time require a great organization and development of the tasks, which is often not reachable in the reality.

So, scheduling the activities by priority supports organizations to manage the numerous tasks.

The prioritization, similarly to the Balance Scorecard and Value Ring, associates the elements contained in the table to three significant colours to support an impacting graphical representation:

• Red: Action with urgent priority;

• Orange: Action with intermediate priority;

• Green: Action with low priority.

As described, the document takes into consideration financial and non-financial factors which are determinant for the sustainability and competitiveness of the business over time. It collects all the possible problems/solutions affecting the organization which are revised and selected to complete the startup’s operational plan, the Executive ICE-Diagram.

Problems and opportunities, after the identification through the SWOT analysis, are defined and developed by their analysis under the four perspectives used for the Balance Scorecard:

1. the financial perspective;

2. the customer perspective;

3. the perspective of internal management processes;

4. the perspective of learning processes and growth.

The process described to complete the ICE Diagram is applied to the four perspectives to give continuity to the strategic identification and implementation started with the Balance Scorecard. The strategies identified are translated, in this phase, into efficient tangible actions of operative management addressed to specific problems/opportunities and monitored by valuable KPIs.

The identification of the KPIs should be shaped to the business model taken in consideration to represent properly the startup’s operations and capacity in generating value. Each indicator should consider the following information as valuable:

• Description;

• Formula for the computation;

• Responsible;

• Format of data (%, value);

• Trend type (ascending or descending);

• Detection rate (monthly, quarterly, semi-annual, annual);

• Source of data;

• Target origins;

The indicators should be shaped, also, on the perspective taken into consideration. For example, ROE (Return on equity), ROI (Return on Investment), ROS (Return on sales) are financial indicators which evaluate the economic solidity of the startup. Rate of

92 customer loyalty, degree of customer satisfaction, acquisition rate of new customers, profitability per customers are examples of measures related to the ability of organizations to meet customers’ requirements, needs and the target market. The distribution rate, rapidity in answering by the customer care and the degree of product innovation measure the performances of the process from an internal point of view to determine the impact of the value generation and the strength of market relationships. Finally, indicators such as the degree of satisfaction and retention rate of employees, the level of training and the degree of professionalism of the staff, the ability to transfer knowledge and the level of excellence in the information system measure the ability of the startup in growing through continuous learning.

In conclusion, the advantages presented by the ICE diagram can be summarized by four main benefits:

• Performances’ overview of the company activities;

• Communication enablement and understanding of the business objectives and strategic decisions at all internal and external levels;

• Cognitive and operational support for the development of the Solution canvas;

• Clear and summarized information which can be easily processed by an IT system to generate an historical database.