Innovation of Business

and the
Business of Innovation™
 
Multi-Innovation

Leveraging Concurrent Opportunities

Ever wonder about missed opportunities?  Ever feel those nagging worries that you could have done more?  That a critical bit of market knowledge was overlooked? … … Yeah.  Me too.

We all question ourselves.  After all, innovation isn’t easy.  It takes all of vision, strategies, tactics, resource allocation, delegation, choices of outsource providers, and on and on.    Chances for mistakes or omissions seem endless.  And trying to manage it all can dampen creativity.  (big sigh!!)

Perhaps the most subtle yet profound questions lie in our personal innovation paradigms.  What is innovation, anyway?  Where does it apply?  And when?  And why?  Do we have to walk the bleeding edge?  How can we justify the costs and risks?

For many, the innovation paradigm is all about products. What, then, about entrepreneurship as the innovation of businesses?  Does that count?  Radical innovations open up new markets.  Can we actually innovate a market?  We live in an age when new industries spring up like dandelions.  Is it possible to purposefully innovate whole new industries?

Looking inside… can we innovate our own mindsets?  Our paradigms?  Hmmm.  Why not?

Let’s make the challenge a bit more clear.  Our measure of success will be:

Impact: Profitable market disruption per dollar invested

Impact demands that we leverage every resource to initiate and sustain disruptive market change that delivers the greatest possible opportunity, advantage, and wealth.  Are you ready for that?

 

Multiple Concurrent Innovations

Fifteen ways to create impact are listed below.  15 types of innovation.  Frankly, their descriptions are not exciting, so why bother reading on?  … To gain clarity on how to achieve impact by disrupting markets rather than offer incremental products.
Doblin, Inc. (www.Doblin.com ) has done intriguing research showing that innovations become market disruptions when several types of innovation are combined into a business/product offering.  On Doblin’s 10-type scale, Henry Ford integrated five types of innovation with introduction of the Model T.  Dell managed seven with it’s new business model.  Google – seven again with their concept for search.

These innovators didn’t settle for better products.  They combined better business models with unique distribution with evolved customer experience, and more.  They didn’t settle for trying to do better what others were already doing.  They chose to change entire markets forever by altering customer expectations while also creating dramatically greater wealth for stakeholders.

That is, they performed multi-innovation.  They produced several matched and integrated innovations and launched them as a package.  For Ford, new business/financial model, product, value chain, manufacturing, and distribution.

Can you become a multi-innovator?  Only if you can open your vision and broaden your paradigm enough to envision new opportunities through change in your business.  If you don’t know what is possible, you almost certainly will waste your opportunities.

 

Types of Innovation

Let’s cluster types into innovation of businesses, processes, products, and markets.

Business Innovation: The sum of entrepreneurship (innovation of stand-alone new businesses) and intrapreneurship (innovation of businesses within companies).  Business innovation is best when done at all levels of the organization.  R&D, for instance, may innovate itself as an internal business constrained by the corporate vision.  Research teams may innovate themselves within the constraints of R&D.

1. Business Brand Concept: A brand is a value promise made to target markets and mentally linked to the business name, logo mark, jingle, and/or slogan.  Having made the promise, everything done and said by the business must then be consciously led and managed to support the promise.  Specifically, all other types of innovation are used to enable the business to meet its promise.

Core Definitions

Innovation: The term “innovation” has its roots in “going nova”. An innovation can explode into its markets, changing the way people and organizations deal with their worlds. Innovation creates rapid change in almost every facet of human life.

Innovation of businesses, products, processes, and markets, happens in at least industry, government, education, the military, the arts, and religion; in for and not-for-profit organizations; and internally within businesses as well as in commercial markets.

Innovation of businesses faces complexities distinct from those required for products or markets. Using “product” as a generalization, does not imply that required processes are the same.

Innovation as Process: Development of ideas into “products” in use, for the first time anywhere, that create compelling value for customers.

Innovation as Result: A valuable “product” not previously available that meets needs not previously met.

Innovator: An agent of change, both as individual and organization. Innovation management is business or product management with an edge.

Innovators know that businesses and products can go beyond meeting needs to creating and sustaining customer loyalty. Their vision is larger, and so is their impact.

Entrepreneurship: Innovation of stand-alone new businesses.

Intrapreneurship: Innovation of businesses within companies.


 

For “product”: Also read at least: Idea, prototype, technology, research result, service, process, tool, strategy, campaign, facility, business model, functional department, business within a company, company, market, industry.

For “product in use”: Also read at least: “service in use,” “process in application,” “business in service,” “strategy in action,” etc.

For “stakeholders”: Include at least customers, in-house and external investors (in innovation), the extended development team, allies in innovation (e.g., supply chain, distribution chain, technology transfer partners), shareholders, and the economy.

(We refer to “brand concept” because the company can only state the promise and then honor it.  The brand itself lives in the minds and behaviors of customers, investors, allies, and others in the marketplace.  Logic dictates that brand, strategy, and business model all be tightly linked.)

2. Strategy: Where the business wants to go (goals, objectives) and how it intends to get there (methods, systems of methods).  Strategy nests.  For instance, business strategy includes marketing strategy includes communication strategy, includes trade-show strategy.  Strategy may be organized as initiatives.  Six Sigma, Baldridge Quality, and other business re-engineering are initiatives that impact every aspect of the business.
Every type of innovation below
is also a business strategy.

3. Business Model: Who the business is and can be as summarized by, e.g., the corporate mission and long-term goals.  Results of a wide range of thoughtful decisions based on substantial market and product knowledge.
4. Financial Model: In an oversimplified sense, how funding is applied to create revenues, and how revenues are received and turned into equity.  Intimately integrated into the business model.
5. Alliances: Win-win contract relationships and/or collaborations for addressing opportunities while sharing or mitigating risks and costs.  Includes the business’ value chain with its supply networks.  Includes relationships with vendors, partners, customers, and even competitors (e.g., through jointly supported research consortia).  Becomes webs of alliances when an ally brings a suite of connections.

 

Process Innovation: Invention and re-engineering of methods.  Includes all processes used or needed by the business.  (A process innovated for customers is a product.)

6. Core competencies: Owned skills and processes that may distinguish this business from others.  Outsourcing can be a competency.  Some owned processes may be patentable, creating added advantage.
7. Tools and Systems: Multiply interdependent processes that enable complexes of capabilities in the business.  As opposed to competencies, these are typically acquired rather than built.  (e.g., Six Sigma, Lean Manufacturing, IT)  Introducing and embedding new tools changes the business, often to the point of altering basic paradigms.

Product Innovation: Invention, development, testing, manufacturing, packaging, distribution, launch, and service of products.  (see general definition of “product” in the box.)

8. Product Brand Concept: A value promise.  What the business owns (name, logo, etc.) that becomes known, and, ideally, respected by target stakeholders (what the market owns).  Value promise logically precedes product because innovating the value promise changes product requirements. 
9. Features and capabilities: What the product is, does, and enables its customers to do.  The practical aspects of product performance that deliver the value promised in the brand. 
Radical product innovation: A product that is entirely new-to-the-world and performs a function for which no product has previously existed. 
Incremental product innovation: A new modification of an existing product. 
10. Product lines and platforms: Systems of products sharing elements of development and production in order to reduce costs while serving a wider range of customer needs.  Innovating lines can change the business model.  Innovating platforms changes and enables multiple current and future products.
11. Service and Support: A complex combination of strategies for sustaining durable win-win relationships with customers.  The combination of after-sale support for customers and service on the product. 

Market Innovation: Development of a new market based on introduction of one or more radical innovations.

13. Distribution: Delivery of “products” and related services, either directly or via channels of distribution.  We can see distribution as a business in itself, and innovate all of the above aspects of that business.  For some businesses (e.g., Federal Express), the value promise is all about distribution.
14. Customer experience: Brand is a promise.  Experience is the state of having the promise met.  Quality of experience determines loyalty to the brand.  At some levels, experience is so normal that businesses need only avoid making mistakes.  More and more, however, customers expect constant newness.  In language many decades old, satisfaction is no longer enough.  Customers expect delight.
15. Industry: Multiple business innovations over time in response to durable yet new market needs, typically enabled by a cluster of radical innovations.  The computer industry is aging.  Biotech is just now an industry.  Nanotech is coming.
In the long run…

Brand promises drive business and product innovation
that create customer experience powerful enough to match the promises
and generate revenues to fund the next cycle of innovation
on every scale from expected internal developments
to launch and service of radical products that create
new global markets and whole new industries.


The time for multi-innovation is now, and it always will be.  Are you ready to create that level of impact?

 

 

 

 


 

51. Successful visionaries start from where they are, what they have, and what their customers have. (Tom Gilb)

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