Businesses that thrive are investing in continuous innovation
powered by continuous consumer insights. They don’t sit and wait with the risk of losing ground. As Nokia CEO Stephen Elop tearfully said, after announcing his company’s acquisition by Microsoft, “We didn’t do anything wrong, but somehow, we lost”. It was precisely this lack of action, the failure to innovate, that resulted in the downfall of Nokia. Yet with another mindset and the tools available today to drive business innovation the smart way, there’s no excuse for your business to get left behind.
Today’s consumers tend to change their behavior very often and unexpectedly. That’s why it’s more important now than ever that your business evolves to catch up. You can start by looking for opportunities to innovate based on the 3 (really basic but nevertheless crucial) characteristics.
3 basic characteristics of a true business innovation:
- An idea that solves a need in the market in a new way
- Meets this need in a way customers are willing to pay for
- Can be transformed into a product or service available on the market
Innovation can be like sawing off your own legs to grow
New innovation hurts. It is often disruptive and can even hurt your business in the short run. It’s a bit like sawing off your own legs in order to grow newer and stronger legs over the course of a few years; and many businesses aren’t willing to take this perceived risk when quarterly earnings are at stake. So what do they do? They wait and hope, and then watch other innovative companies outpacing them gracefully, as they are sprinting ahead with newer, stronger legs.
Take for example Kodak, Blockbuster, and Nokia. Giants of their industries at the time, each of these business once held a powerful opportunity to innovate; but they all failed to take the chance. Kodak had the patent for digital cameras, Blockbuster was given the chance to buy Netflix, and Nokia could have moved into smartphones; but they didn’t act. Why? Because they were afraid. Afraid it would hurt too much, hurt the quarterly earnings, hurt stock options, etc. So someone else did it instead. How did that work out?
5 areas where customer insights will make a big impact on your business
I would say that there is almost no area in your business where you should not let the voice and the footprints of your customers influence why and how you choose to develop things. Here are 5 areas where I currently help our clients develop their business:
- Assessment of opportunities
- Ideation based on customer insights
- Brand development
- Concept and offer development (that this article is mostly about)
- Marketing and advertising development – where “detail” is king
But let’s get back to talking about innovation. Can big businesses innovate? Of course they can! They have the resources, industry expertise and distribution at their disposal. They just need the right mindset, tools, and the right people.
The 5 pillars of business innovation that every business can use to succeed:
- Acquire the right talent and focus on the people in your organization.
- Create the right environment. Business managers tend to minimize risk, optimize processes and make changes with extreme caution. Most of them are afraid to fail, ending up by doing nothing, until doing nothing is a bigger risk. That’s a poor environment for innovation.
- Be opportunistic. To unleash the innovative power of your business, you must be willing to take risks, go outside of normal processes, and prototype new ideas.
- Let go of control; incentivize instead. The only way to do that is to give the entrepreneurs in your organization freer reign. Manage them with incentives and not rules, processes, checks, and balances. Managing innovation in a controlling way will never work because, per definition, real innovation is a high risk venture with many uncertainties. If you manage real innovations like “a normal project”, then you will fail.
- Create a system for continuous customer and market feedback to understand the real habits, rituals, and beliefs that will empower your organization (the lifeblood of an innovative business). It’s hard to make your customers change their behavior. Apple and Procter & Gamble, for example, make a point of engaging customers directly to generate new ideas. They develop new products and services based on superior end-user understanding.
5 crucial steps to develop a customer feedback system to drive innovation
To develop a system to generate continuous customer and market feedback, which will drive innovation, you need to ensure a better fit for your products/services and reduce time to market.
- Understand the difference between data and customer insights. Behavioral data often gives you tons of information about What, When, Where, and How, but not so much about Why. Customer insights on the other hand is all about the drivers, the motivation, the unmet needs, the concerns, and the wishes; the fuel for your innovation and your marketing and development opportunities.
- Gather customer data from multiple channels, including feedback and actual behavior (the footprints of your customers). Use this data to identify needs your innovations can solve… and do this continuously.
- Change the way you work with innovation. Apply a much more agile approach. Interact with your customers through the whole process from early ideas to launchable products.
- Collect data on your actions as well as your competitors’ actions to learn from successes and failures systematically.
- Test and learn, test and learn, test and succeed. There is nothing wrong in failing as long as you learn from your mistakes. This is how the masters of innovation does it.
I help businesses to thrive with innovation by utilizing the power of continuous consumer insights. There is no end to what you can achieve with real-time consumer insights, customer feedback, and footprints. It changes the way your business thinks about innovation and you avoid the risk of becoming another Nokia. In this post I have only scratched the surface. Why not get in touch with me and I promise to let you in more on the secrets and get your organization started.