Companies everywhere are prioritizing innovation as they seek new advantage and opportunity. Innovation comes in many forms in the quest to create value and opportunity.
Innovation can make significant contribution to business value and profitability. Make sure you’re well prepared to take full advantage of any innovation efforts you consider or undertake as some innovation efforts are successful, while others can’t seem to deliver.
In working with clients for over 25 years we’ve uncovered areas of innovation confusion and mistakes to avoid that result in lost opportunity and lower profitability. Don’t make avoidable mistakes like these:
1. Confusing R&D with Innovation. Hiking R&D spending does not automatically raise innovation success. Cutting internal R&D spending and seeking new idea from around the company and from outsiders can often be more productive.
2. Not Including Marketing. Marketing has tools for ferreting out hidden needs of customers and markets. Marketing can bring insights into innovation that may not be apparent in product development or operational groups.
3. Forgetting about Design Strategy. Traditional design approaches tend to look for incremental improvement, using existing (perhaps legacy) information. Strategic design strategy provides tools for determining new products, visualizing a new future and understanding customer emotional connects to products and services.
4. Confusing Innovation with Technology. To be sure, technology is leading much of the innovation in business today. Solely relying on a technology-centric approach to innovation can result in complex, hard to use and benefit-elusive products and services. A customer-centric innovation approach generates products and services that people crave.
5. “Out of the Box” Thinking with No Discipline. Creativity is key to innovation. Creativity allowed to run “free” can lead to very interesting ideas, many of which will be unworkable. Harness the power of “out of the box” thinking within a formalized innovation process that creates discipline, include proper incentives and is under proper leadership.
To avoid these challenges we’ve seen our clients achieve innovation success by instituting the following strategies, process ideas.
A. Open Up. End “not invented here” cultures by linking R&D work to external and online networks of scientists and labs. Bring in outside design and innovation expertise that you don’t have in house. Send your top executives out shopping for products and services sold by their companies to learn firsthand how easy or difficult it is to do business with your company or products and services.
B. Lead the Revolution. CEOs should lead a cultural revolution inside their companies by personally championing a goal to raise innovation success rates, and by hiring designers and scattering them to work with engineering, marketing and brand units.
C. Change People and Skills. When it comes to innovation, legacy thinking and personnel may not get the job done. Consider bringing new skill and experience alongside existing personnel or replace people with others that demonstrate innovation success. Also, consider bringing additional disciplines such as anthropologists and social psychologists to work with your engineers.
D. Align Incentives. Link bonuses to new ideas, better customer satisfaction and experiences, revenue growth and profitability. Connect innovation-related spending to big breakthroughs that identify new ways to do business, new markets and customers and new brands that build business value.
E. Turn Innovation Process Upside Down. Innovation has traditionally meant developing and designing new products or services in the lab, then tossing it at the customer. Innovation today means observing customers in their context, conducting broad and deep data analysis with the help of artificial intelligence and big data logic, integrating customers into your product and services development teams, speeding up innovation processes and iteration cycles and delivering more “smaller innovations” instead of looking for “home runs.”
The Afterburner Group has been accelerating innovation for companies in the technology, energy, services, manufacturing and non-profit industries for over 25 years.
If you think that your innovation is suffering or could benefit from an assessment, new direction and accelerated benefit, fill out the contact form below and we’ll show you some options that deliver fast return on your investment.
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