RSMS

The Little Black Book of Innovation

How it Works – How to do it

Scott D. Anthony

Harvard Business Review Press

Companies spend billions of dollars to advertise products that customers don’t want

Large companies are capable of doing amazing things, but when it comes to innovation, they just scratch the surface.

Marketing teams are busy producing PowerPoint documents on products rarely to be launched.

Companies often look for opportunities by saying something along the lines of: We have things to sell. Who will buy them?

What would you offer your 3-year old child for Christmas?

Dora The Explorer toy laptop, or an iPad?

The customer may very well prefer an offer that is sense & simplicity over complex & technical (what we call overshooting)

What is innovation? Something different that has impact. Impact means measurable results.

The word “technology” does not appear there. The word “creativity” does not appear either. Creativity, of course, can help in the innovation process. But innovation is a process that combines discovering an opportunity, blueprinting an idea to seize that opportunity, and implementing that idea to achieve results. No impact, no innovation.

Take Leonardo Da Vinci and Thomas Alva Edison. Both men were geniuses. Da Vinci was a creative genius. His ideas didn’t have impact at the time. Innovation is not an academic exercice where we think, think, think, but never do. The stock ticker-tape symbol, phonograph, incandescent light bulb, motion-picture industry… all have their roots in Edison’s labs in New Jersey. They all were different. They all had impact.

The new normal is perpetual change

In today’s world, innovation is not an option. And it may require walking away from the things you view as your core competency. Imagine: What if we were legally prohibited from selling to our current customer base?

Ted Levitt, “Marketing Myopia“:

Customers have problems. The company has potential solutions.

People don’t want quarter-inch drills. People want quarter-inch holes.

Peter Drucker, “Innovation and Entrepreneurship“:

Companies need to take a customer-first perspective to succeed with innovation.

Nobody pays for a product. What is paid for is satisfaction.

The customer has a problem to solve or a job to get done.

Now, if you go to your customers and ask them what job they are trying to get done, you are likely to be met with a blank stare. You just need to keep asking Why…? Hence…? And Therefore…?

Why do you want to buy a drill?  – I need to drill a hole.

Why do you need to drill a hole?  – I need to hang a picture.

Why do you need to hang a picture?  – I want to make my living room look nicer.

Why do you want to make your living room look nicer?  – My mother-in-law made an offhand comment about the room last time she visited, and I don’t want this to happen again…

The goal is to move from a solution to the source of the problem. Deep understanding of the problem can reveal the customer dream solution. Train yourself to spot signs of frustrations at your customers’.

A.G. Lafley, “The Game-Changer“:

Innovation is a process that can be managed and measured. The key to successful innovation is a customer-is-boss mindset. We have one and only boss. The Customer.

You need to focus on the customers wants and needs. You need to spend time with your target customers. You need to appreciate not just what the customers were saying, but also what they were feeling or unable to articulate. You need to understand what the person says he or she wants and needs, what he or she can’t easily articulate.

There are two moments of truth. The moment a customer chooses a product. The moment the customer uses a product.

Triple the amount of time you spend with your customers. Get the marketers out of HQ to spend time with the customer. It will help you feel their hopes, dreams, frustrations, and desires. This is a critical input to spot opportunities for innovation.

Joseph Schumpeter, “Capitalism, Socialism, and Democracy“:

The problem that is usually being visualized is how capitalism administers existing structures, whereas the relevant problem is how it creates and destroys them. Sometimes you have to destroy in order to create.

Schumpeter coined the term “creative destruction“.

Vijay Govindarajan, “Ten Rules for Strategic Innovators“:

Existing companies that want to master strategic innovation have to carefully borrow some core capabilities, thoughtfully forget others, and systematically  learn some completely new skills.

Dave Goulait, P&G Innovation Productivity Team:

To do something different, you have to do something different. It is almost Einsteinian in its simplicity.

If your mission is to shake up the corporate establishment, or to create what does not exist, you simply cannot do the same thing that everyone else is doing.

Historically great companies such as Kodak, Digital Equipement Corp., IBM, Sears, General Motors, Sony, Nokia, Microsfot, RIM (…) stumbled by doing precisely what they were supposed to do.