2015

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Stop trying to always do more in innovation

Whenever you feel the need to add something, do exactly the opposite.

One of the most common approaches to product innovation is to keep on adding functionality: “our newest product now also has this feature, plus it can …”. And-and-and. We all know the examples. But what happens is that by adding features, the product becomes more complex and sometimes even too complex for its users. Besides, consumers often are not aware of the full range of a product’s features and a lot of functionality remains unused. This type of innovation typically offers companies only a small incremental benefit that comes at huge costs.

The proverb “less is more” is generally true, also in innovation. If you feel like you have to do more to prove your point, think again. The answer often is to do less.

Instead of adding new features and components, start thinking about which elements you can remove. Take away something that is considered essential to the product: remove the glass of a bottle, eliminate the voice calling functionality from a phone, take away the screen of an umbrella……. It is not about cutting costs, but finding new benefits and creating new value in the marketplace. Innovation is all about creating new value and ideally a lot of it.

sub

This subtraction principle also generates great new ideas when applying it to business models. Chances are that you have rented a car before. Imagine a traditional car rental company and boldly start eliminating some of the essential elements of the value proposition. Let’s remove the pick-up and drop-off locations, next take away the choice of cars and eliminate the minimum duration of rental. What new benefits can you generate? What new value can you capture? What potential new business model do you get?

Next time you get your team together to come up with new ideas for your products, resist the temptation to add something to the product. Instead, systematically remove essential components and ask yourself the following question over and over again: “what new benefits could potentially be created by eliminating this element?”. You will be surprised by the great number of creative ideas that are generated and that may lead to discovering new opportunities.

 

© Ernst-Jan van Batenburg, FlyWheel Business


Please check out www.flywheelbusiness.com for more information on our innovation & consulting services. […]

By |May 20th, 2015|2015, Blog|0 Comments

Stop listening to the Voice of the Customer in innovation

Do your customers know what they want? Do they have any idea what their needs will be in the future? Can they tell you what it is that they are willing to pay for?

Suppose you have a business manufacturing high-quality leather wallets and you would like to innovate your product. You start by asking your customers how they will be using the wallet in the future and what changes they would like to see. The feedback you get might vary from using a more premium type of leather, to space for more credit cards or a slimmer design. If you would base your innovation only on this, your sales could plunge or you could go out of business entirely.

The problem is that people typically cannot see a wallet having another function than containing cash and cards, nor can they imagine another way of storing cash and cards unless presented with it. That’s just how the human mind works, a condition of cognitive bias or functional fixedness.

How often have you come across a product or a service thinking: “This is so great, if only I could have had this years ago”. Did no one ask for it? Apparently not, or not enough. How many people have asked Apple back in 2006 before the introduction of the iPhone: “Hey, I want an iPhone and I am willing to pay a lot of money for it”?

mic

Let’s move away from listening to the Voice of the Customer as the first step in the innovation process. Instead, we should consider the Voice of the Product. What could the product itself tell us? What virtual products or services could we think of if we would cleverly manipulate the existing situation? And only at this point in the process we check back in with our customers to see if it could be of value to them.

Circling back to the wallet. How about we change the shape of the wallet and turn it into a smartphone cover? Can we find any benefits in doing this? We certainly can. How much cash are people carrying nowadays? What about the trend towards mobile banking and mobile payments? How many credit, debit and loyalty cards will we keep carrying around in our wallet? What will the content of the wallet of the future be: cards or a smartphone? […]

By |March 24th, 2015|2015, Blog|0 Comments

How an industry marries technology and tradition through innovation

The classic watch industry finds itself in a squeeze. On the one hand, we see that it has become less common for younger generations to wear wristwatches, while on the other hand technological newcomers such as Apple Watch and Pebble are winning market share. How does the traditional watch industry that is characterized by tradition and craftsmanship react to these technology-driven trends?

Bearing in mind the sector’s desire to keep honoring the key values of tradition and authenticity, unsurprisingly the answer is slowly but surely.

We are now starting to see promising innovative examples of how this sector is adapting to current trends. Frederique Constant, a Swiss brand of classic timepieces, has just introduced its Horological Smartwatch, a traditional wristwatch with software inside that connects to the smartphone. It offers functionality such as sleep monitoring and activity tracking.

Frederique Constant

Swiss luxury watchmaker Breitling has introduced its Exospace B55 Connected model that connects with a smartphone enabling receipt of notifications for email, messages or telephone calls. It can also display the day’s next appointment in hours and minutes. Both the watch and the smartphone app are Swiss made.

breitling

Montblanc, a high-end manufacturer of classic luxury goods, is definitely taking up the challenge of embracing new technological trends. The company’s watch division has recently introduced the e-Strap for its TimeWalker model. The innovative bracelet of this classic Montblanc watch contains wearable technology that connects to the mobile phone and allows you to read previews of email, read text messages and see calendar entries.

montblanc-e-strap

Frederique Constant, Montblanc and Breitling have innovation running through their veins. They dare to look beyond their traditional products and business model while staying true to their core values. They are finding new opportunities and new ways for adding value to their customers.

The sector perfectly understands that there are people that greatly enjoy traditional watches and luxury goods, while at the same time appreciating technological advance. The watch industry is starting to marry technology and tradition through innovation. Will it be a marriage of convenience or will it become a marriage of love? Time will tell.

© Ernst-Jan van Batenburg, FlyWheel Business


Please check out www.flywheelbusiness.com for more information on our innovation & […]

By |March 9th, 2015|2015, Blog|0 Comments

Recognizing proven innovation patterns in Netflix

Netflix fundamentally changes the way we watch movies and shows. We now have a vast number of shows available that we can watch at any time we like, anywhere, on any device. We can play and pause at will and create favorite lists. Start binging ladies and gentlemen!

Netflix (NFLX) is one of the most successful dot-com ventures ever with a current market capitalization of around 27 Billion dollars. In just over a year after its introduction in the Netherlands in September 2013, the national Netflix subscriber base has reached the 700,000 mark.

netflix

The conditions in The Netherlands are very favorable for Netflix. The fast growth in the Netflix customer base is in part fueled by the widespread availability of broadband internet and high-speed 4G/LTE mobile networks. Moreover, smartphone penetration in the country is expected to pass 50% in the near future.

And there are other factors that make Netflix successful. In their book Inside the Box, Drew Boyd and Jacob Goldenberg describe five underlying patterns that account for the majority of successful highly innovative products. They have called the method: Systematic Inventive Thinking, or SIT.

All five SIT patterns can be recognized in the Netflix service and business model when we compare it to traditional television. We will briefly look at a few of those patterns.

Let’s start with the Subtraction pattern, the pattern in which is a component that was formerly thought of as being essential has been removed. Notice that there are no commercial breaks anymore? Commercials have been taken out of the business model, they are no longer needed and the absence of it creates new benefits. We can now enjoy an uninterrupted program.

Let’s build on that: an uninterrupted program that can be paused and resumed at will. Something that wasn’t possible with traditional television in the past. The SIT pattern that you can see at work here is called Division. The viewer has the ability to divide the service over time. He can now decide himself when it’s time to get a cup of coffee instead of having to wait for the commercial break. That’s a great benefit.

The last pattern we will discuss here is Attribute Dependency. In this pattern, a dependency between two variables is created or removed. Consider the location where you needed to be in order […]

By |February 10th, 2015|2015, Blog|0 Comments

Three innovation principles

Imagine you run a successful business with happy paying customers. Would you just sit back and relax? No! You would be looking at ways to sustain that success, and to become even more successful. You would be innovating all the time, right?

I believe most companies know they need to innovate and many of them realize they should not wait until sales slump and business becomes less successful. However, it happens that companies respond too late to changing customer behavior or find themselves surprised by new competitors shaking up their industries.

If you want to run a successful business on the longer term, you need to fix the roof when the sun is shining.

Companies know they need to innovate and they know they need to do it now. The problem many companies face is how to do this thing called innovation. Each company and every industry is different and has its own specific characteristics. However, here are three principles that are universally helpful.

  1. Create fertile ground

fertile

Many companies have a business unit “Innovation”, but successful innovation needs more than just a department bearing this name. To be structurally successful in innovation, the entire organization must embrace it. Innovation must run through the company’s veins. It is of fundamental importance to develop fertile ground so that innovation can take root in the organization. Innovation needs to be part of a company’s strategy, embraced by its management and supported by its internal processes.

  1. Innovate systematically

Innovate-systematic

Popular well-known products came about by some stroke of luck. Pure serendipity. But organizations can’t just rely on luck as their source of innovation. The future of a company must not depend on it. What we need is a systematic approach for innovation that continuously keeps pouring new innovative ideas into the innovation pipeline.

  1. Build an innovation pipeline

Innovation-funnel

Just as companies need a sales pipeline, they need an innovation pipeline. The systematic innovation process of the company generates new ideas that vary in potential opportunity and may require different implementation capabilities. All these ideas are fed in an innovation pipeline where […]

By |February 10th, 2015|2015, Blog|0 Comments