Witnessing the chaos that has taken place over the opening of Heathrow Terminal 5 over the last few days is a salient warning over the dangers of launching a new system, as we are preparing to do with iD-points.

The madness and confusion that has reigned at T5, due to issues with the baggage system, has been not only a PR disaster for British Airways and British Airports Authority, but also a financial disaster, potentially costing billions of pounds.

There are lessons that we can learn from the T5 meltdown, and we will be applying all of these as we look to roll-out the new version of iD-points.

1. Problems occur in unexpected ways
Launching a new system, like opening a new aiport terminal, is a complicated business. Problems will spring from unlikely sources. In the case of T5, who could have predicted that the lack of security guards admitting baggage handlers to their carpark would be one of the root causes? Small details can have a knock on butterfly effect, which in the case of T5 led to delays and confusion, then to flights departing with no baggage, and finally dozens of flights cancelled altogether.

No matter how elegant the grand plan, the devil is in the details.

2. Dont make a drama into a crisis
Once things started to go wrong, BA and BAA handled the situation terribly, creating more confusion, anger and resentment amongst passengers. Inevitably they have been blaming each other.

Customer service is always the key, no matter how good the product. As we have always said, you only really find out whether customer service is any good when there's a problem.

Some of BA's fall from grace may have had something to do with the overconfident tone set by BA's and BAA's marketing machine. Back in September 2007, Geoff Want, director of ground operations at British Airways, boasted:

"We've six months left before we start using this building and we can't wait. It's a once in a lifetime opportunity. In the next few months we are going to test every aspect of it so it will work perfectly from day one."

Meanwhile the Terminal 5 website at features a rolling slideshow of the calming concourse, 'effortless transfers', 10-minute check-in, and a baggage system "ready for what's ahead".

This gulf between hype and reality is not only insulting but it is also an abuse of trust. It's better to prove how good things are than boast how good they're going to be.

3. Slow rollouts are preferable to big launches
Who knows why such a large number of BA flights were switched across to T5 at once, rather than a slow transition from one terminal to the other. Economic pressures mean that BA are looking to move all their flights across to T5 by April 30th - an aggressive schedule that leaves almost no margin for teething problems, let alone scenes of grand chaos central. But I suspect that there was also a desire to create a fanfare event, a grand spectacle. It was a risky decision which has backfired spectacularly.

4. Stress tests are essential
One has to doubt whether enough testing and training took place in T5. It would have been a good idea to run more 'stress tests', ie running the airport as if it were in operation, but with staff and 'actors' rather than fare-paying customers to make sure all parts of the process of check-in, departure and arrival were working smoothly.

The emergency services regularly stage mock incidents to test their procedures, skills and grace under pressure - this seems to have been lacking at T5. Likewise in web application development proper testing involves load testing the system with simulated traffic levels, dummy data, and live beta testing before being deployed to the actual user base.

The new version of iD-points is our T5. Let's make sure it goes a lot smoother!

Kaizen (pronounced "kigh-zen") is the time-honored practice of continuous, incremental improvement. In the software industry, it's the practice of actively improving designs, code, processes, and everything else, continuously, now and forever, to create a complete customer experience. The principles of the Kaizen Software Manifesto are:

1. Make continuous improvements in every aspect of the business.
2. Actively pursue a superior, complete customer experience.
3. Continually improve designs, code, and processes.
4. Strive to increase agility (binshou) while reducing costs.
5. Use the Deming Cycle to minimize disruption from change.
6. Prevent errors (poka-yoke), in software and in business.
7. Respect people, leverage expertise, and trust staff.
8. Reward suggestions, improvements, and progress.
9. Always move forward.

At IncentiveDirect, we're embracing Kaizen principles in the development of our incentive systems.

In the light of recent fiascos at a number of UK companies and government departments, it's important to realise that with each event consumers and the public's trust in these bodies diminishes.

Our clients trust us with sensitive information. We take great care of that trust because once it is lost it won't come back.

Like Northern Rock, we hold peoples money for them. Which is why it is essential that we have reserves to meet any redemption.

Like HM Revenue & Customs, we hold data on all of our end users. We have a number of processes to ensure that this data is held securely. We are registered as a Data Controller with the Information Controllers Office under the Data Protection Act (1984), and review our processes with regard to privacy and security.

Like Southern Water, we make assurances about our level of service. While we are not regulated we do have a duty of care. Once you start being deceitful, you create an edifice built on lies and misinformation. Truth and openess is a much stronger platform on which to grow a business.

Our clients are more than welcome to ask us about our business processes, and what we are doing to protect their money, their data, and their users privacy.

Everyone is obsessed with change, but there's nothing worse than empty rhetoric. Change has become an overvalued commodity, change for the sake of change, with almost no consideration of what is going to be changed and to what.

As they say, the more things change the more they stay the same.

Check this out. Apparently, Hillary Clinton "embodies change", while Milt Romney has "brought change for the last 25 years", but I think he might have been referring to his lunch money.

If there's a serious point to make here, then make sure if you are looking to change behaviour with an incentive, be clear what the new behaviour should be. For corporations, behaviour change has to also be good for the bottom line.

Simplicity is a journey, not a destination.

As we develop the next version of iD-points, it's tempting to add in a lot more features and functions. In trying to try and meet the exact requirements of everyone, a once elegant solution can become riddled with complexity, and beset with kludges, hacks and workarounds. Giving in to this temptation leads to feature creep, which leads to bloatware, and before you know where you are you've created Microsoft Office.

Taking the path of simplicity is more challenging, but ultimately leads to products and services that cut through the complexity too often associated with computer hardware, software and services, and deliver real benefits to users.

The iPhone could be considered the acme of simplification. Apple have looked at the whole mobile phone experience, from purchase and activation, user experience and functionality. At every point they have thought long and hard about how the process can be simpler, more elegant.

The result is a smart phone that has redefined the market. It's beauty lies as much in what was left out as what has been included. It can almost be a paradigm shift, a new way of thinking.

If products like the iPhone teach us anything, it's that stripping away is incredibly empowering, and ultimately leads to a better user experience, and a better product.

A reading of the Pareto principle tells us that 80% of users only use 20% of the features of an application. The challenge is to create systems that are loose-fit enough to adapt not only to the requirements of different companies, but critically, the changing requirements of any organisation.

If there are two words that strike terror into my heart it's Enterprise Software. There's a conception that somehow big, important companies must only want to work with big, sprawling, monolithic software 'solutions', rather than focusing and tools and technologies that get the job done.

As soon as you step into the enterprise software arena you enter a new world of language and terminology, as each company tries to make out they have somehow reinvented the wheel. So for instance Salesforce have now hit upon "Software as a Service" ™ "the world's first multitenant ondemand service", or what you or I might call a web application. Everywhere in this sector, acronyms like SaaS, SOA and ASP abound.

As respected designer and writer Khoi Vinh rightly identifies, enterprise software doesn't get criticised to the extent of a $30 piece of shareware:

"Shielded away from the bright scrutiny of the consumer marketplace and beholden only to a relatively small coterie of information technology managers who are concerned primarily with stability, security and the continual justification of their jobs and staffs, enterprise software answers to few actual users. Given that hothouse environment, it's only natural that the result is often very strange."

I think another reason why enterprise software lacks critical evaluation is that people are unwilling to risk dumping on something they or their company must have spent many thousands of dollars on. The Emperor's New Clothes are always in fashion in the Software Enterprise. Companies become bogged down in IT-led infrastructure projects, where innovation and flexibility are but distant constellations.

If the Web 2.0 revolution has taught us anything, it's that genuine innovation comes from the bottom up, in creating small and nimble applications that do a few things really well, rather than trying to do everything.

We're constantly striving to add flexibility and at the same time simplify. Stripping away all that is unnecessary to leave only that which is essential is tough in this era of feature-creep, but one that ultimately leads to better products that work better.

Flexibility and adaptability, a loose-fit approach, allows small developers like ourselves, to meet the needs of our clients with a little imagination, rather than creating an enormously complex, narrow-focused systems that cannot adapt to changing client requirements.

Barclaycard have recently launched the OnePulse card which combines a credit card, cashless payment card and an Oyster card for contact-less payments including travel on London Transport.

You can find out more at Barclaycard's faintly ridiculous Institute of Future Living.

We continue to track new formats for payments, which will trickle down to the incentives, creating new ways that they are distributed and redeemed.

As we have stated previously, the future of incentives is connected and mobile.

How much would you value not having to do a 2-hour round-trip commute to work?

Flexible working practices are gaining ground as the means of improving employees work-life balance and improving staff retention. Mobile telecommunications and cheaper laptop computers mean that knowledge workers no longer need to be chained to a desk.

But a study by the UK's City & Guilds and Institute of Leadership & Management has concluded that many managers are suspicious of employees working from home.

As reported in Management Issues, managers may outwardly support more flexible working patterns:

"but scratch the surface and managers remain deeply unhappy about letting employees out of their sight, much preferring to manage a team that is physically sat there in front of them.

The research has found that, while nine out of 10 managers said they trusted remote workers and three quarters recognised they were more productive, a significant minority admitted they were still unable to break their old-fashioned "presenteeism" management style.

This was despite the fact that new technology was making remote working a much more viable option."

As we have previously asserted, work is not somewhere you go, it's something you do. Attempting to enforce mid-20th Century working practices based on Taylorist time-management principles is doomed to fail.

The old image of the 'helicopter' boss, hovering demonically over his staff, will give way to a more enlightened, assertive boss, using communication technologies positively to monitor performance and productivity, and engage with staff.

Incentives are an essential part of the new work ecomony, rewarding productivity, encouraging proactive behaviours, and helping staff set their own goals. Online systems such as iD-points can operate seamlessly across a distributed organisation, wherever it's staff may be.

But these systems can also to build an element of community amongst users. Using the news feature to announce winners of monthly performance awards, for instance, is a good way to highlight the success stories of the company, and to emphasise a shared endeavour.

In 50 years time, the idea of a corporate office building may be as alien as a Victorian workhouse is to us today. The rules of engagement between staff and employers are changing. Heads-up companies will plan to promote self-sufficiency, look to hire self-motivated staff, and inspire them further with well structured, tactical incentive campaigns.

Remember, iD-points can be spent on IT equipment for that tricked out home office!

It's with slight dismay that I read that the music retailer Fopp has closed its 105 shops across the UK, but not surprise.

While the closure may be due to the chain overstretching itself after the takeover of MusicZone, these must be especially hard times for retailers of media. I wandered into HMV on Oxford Street the other week, and came out a few minutes later, emptyhanded, and feeling rather bewildered. I really couldn't face shuffling my way past endless racks of discount CD's to the back of the store to scour racks alphabetically arranged by artist, looking for something to take my fancy. It suddenly felt not just archaic but atavistic.

But while media stores might be extra vulnerable from downloading and the behemoth that is Amazon, all large stores full of stuff are vulnerable from the Internet, because they don't offer a better shopping experience than online.

Any large shop, filled with boxes of stuff, poorly laid out and staffed by badly informed sales staff that are either overly aggressive or catatonically 'am i bovvered?', is staring into the abyss.

So the fact that legendary music store Rough Trade is closing its venerable Neal's Yard store, and opening a new 5000sq ft. 'superstore' in London's hip Brick Lane is raising a few eyebrows as either the last hurrah of a dying breed - the independent record shop - a work of dark genius, or just a smart move for a shop closer to a willing customer base.

To succeed, Rough Trade will need to avoid the temptation to be a boxshifter and instead stay a boutique, and retain the unique charm that made the tiny Neal's Yard dungeon a great place to browse, listen and shop for music. It will need to rely on knowing and cultivating its customers and providing guidance, not just pile stacks of CD's at high street prices.

In a recent TV series, Mary Queen of Shops, retail guru Mary Portas revived the fortunes of several fashion boutiques by getting them to focus on the strengths of a small, independent boutique in the face of high street chains. The answer lies in careful merchandising, knowing your customer ("who's your tribe?" squawks Portas at regular intervals), and knowing your merchandise. In a good boutique - and the lesson can surely be applied to all businesses, not just to fashion - a small independent retail outlet can move quickly, and be a trusted arbiter of taste for its customers, who look to it for guidance. Rather than having rack upon rack of merchandise, personal recommendations and niche marketing are the answer.

So can a 'boutique' approach work on online retailing, including an online incentive store? We believe it can. We have already taken the step at capping the number of product lines we stock in our iD-points online incentive store, and we carefully select the products available in certain categories. But we're also looking at ways to improve the retail experience of spending your points online, and building a community among the End Users who shop there.

While few online retailers can match the product range of an Amazon or Play, they are a juggernaut that has no real affinity with any of the stuff they sell, or, dare we say, their customers. They sell several thousand digital cameras, but how do you know you're not buying a lemon? Amazon rely on a series of best-seller charts, customer reviews and ratings, and "customers-who-bought-this-also-bought-that" style cross-selling, to try and help consumers make buying decisions.

Then of course, there are the crude personal recommendations, parodied by The Onion as "Amazon.com Recommendations Understand Area Woman Better Than Husband":

"Area resident Pamela Meyers was delighted to receive yet another thoughtful CD recommendation from Amazon.com Friday, confirming that the online retail giant has a more thorough, individualized, and nuanced understanding of Meyers' taste than the man who occasionally claims to love her, husband Dean Meyers."

The power of search and the "unlimited" shelf space a virtual store offers is a temptation to provide an excess of choice, when actually what consumers want is less choice, and more guidance. Great customer service and aftersales support is another area where a small independent retailer can outshine the boxshifters.

Adding staff picks and recommendations, and running passionate, informed reviews of a carefully selected range of products from people who actually use them is a great way to add a unique voice and personal touch.

Combine this with browsing opportunities that allow a chance for some serendipity, and allied to authoritative and knowledgable cross-selling - "you've bought X, it works great with Y" - and you have a powerful way that an online store can operate more like a boutique and less like a boxshifter.