Updated: Jan 19
Innovation methods have been discussed controversially from time to time. The well-known silicon valley giants rarely refer their success to a specific innovation method. Their founders are more known for their personality and achievements than for innovation methods. In their cases, criteria such as visionary thinking, creativity, outstanding commitment to their ideas, and the ability to cope with extreme workloads seem to outpace any of the popular innovation methods. What does it mean for the typical company or the so-called SME that never has been a unicorn or never wanted to be?
Well, every systematic, process, model, or method comes with advantages and disadvantages. It is part of their nature that they contain simplifications, assumptions, conditions, definitions, and decisions.
Let's have a look at recently popular innovation methods:
Blue Ocean Strategy
The concept of the Blue Ocean Strategy was invented by Kim & Mauborgne. Its fundamental intention is to enable companies to create new markets, the so-called "blue oceans." They are characterised by less or no competition and offer a broad range of opportunities. It allows companies to escape or reduce their dependence on existing markets with intense competition and low profits. The strategy strongly focuses on "value innovation" for customers in new or redefined markets. At the same time, it emphasizes cost-effectiveness. The approach not only questions existing markets, products, and services. It seems to have effects on many significant characteristics and structures of an organization.
The core of this approach is a matrix called "strategy canvas" that supports both analysis and execution efforts. It contains critical elements and their relevance, describing an existing market situation. It is a starting point of an innovation process by creating new key factors, increasing or reducing emphasis on existing key elements, or eliminating them from the company's efforts. The matrix is used to visualize different scenarios that support communication during the draft and development phases. Furthermore, there is an app for mobile devices available. As a result of this process, the company outlines new value propositions, which might set it apart from existing markets and competitors.
The simple structure of the matrix can be considered as both a strength and a weakness of the concept. It provides freedom and flexibility to develop easily new sets of critical factors as the basis of powerful innovation strategies. On the other hand, the outcome might be perceived as too vague or inaccurate on an operational level of an organization.
The Lean Startup is an startup business approach by Ries. A primary assumption is that it needs the right process to start and built a new business successfully. While the name of the methodology contains the word startup this does not exclude the corporate world, as he emphasizes common grounds between startup entrepreneurship and corporate management in general. It is all about innovation in terms of creating new businesses. The Lean Startup bases on other concepts like "lean thinking" to avoid unnecessary activities and to support learning during the innovation process.
The development of a so-called "minimum viable product" is an essential part of the concept. This is a very early version of a product that might also include errors. It is shipped to first customers to receive feedback as early as possible and start the "continuous improvement" efforts. This fast iterative development process is another essential part of the concept. Its loops cover product development, measurement, and learning from data analysis and customer feedback at a fast pace. It intends to develop a product that customers demand and like without wasting time and resources.
An advantage of this concept is the emphasis on customer feedback, learning, and speed while avoiding all the unnecessary activities. It focuses on delivering value to customers and creating growth in the business. On the other hand, very new products contain a potential risk to frustrate customers depending on the customer type, the market, and the industry. Furthermore, it can be a challenging task to make the necessary assumptions and systematically test hypotheses to get useful insights as the basis of the decision making.
Design Thinking is a concept containing remarkable variety and flexibility. Lockwood & Papke investigated the characteristics of Design Thinking in enterprises and their implications on organizations. They mention three general baselines of the concept: It is vital to find and select a problem of relevance and to get an in-depth understanding of users. A second major characteristic is an integrated empathy in all the co-creation activities regarding users and team members. Experimenting in terms of quickly creating sketches, mockups, prototypes, together with the intended fast learning, is another baseline of the concept.
Furthermore, Lockwood & Papke address many elements of organizational and cultural implications of Design Thinking in enterprises. They also mention that organizations driven by purpose create better results with their innovation activities.
Brown & Katz define three phases in Design Thinking they call "spaces of innovation" as part of project style efforts rather than process activities. It starts with the constraints of the subject and the so-called "brief," which have a strong influence on success. They highlight that both too narrow and too wide definitions at the beginning have adverse effects on the outcome of a project. The three phases are named "inspiration" containing a problem or an opportunity, "ideation," covering all the creative activities including practical experimentation, and "implementation" for what remains to be done for the market introduction. This approach consists of iterations and allows a high degree of flexibility to go back and forth between phases. It has the character of an exploration and differs from strict business processes with well-defined sequences.
The strong emphasis on empathy and exploring customer's needs in combination with co-creation provides advantages, particularly in consumer businesses. On the other hand, it is possible that co-creation with customers leads to incremental innovation and prevents companies from developing more radical innovations, which could set them apart from competitors. While visualization and experimenting in interdisciplinary teams are very effective ways of collaboration, the role of design itself might be different in industries and technological domains outside consumer businesses depending on the parts of humans in these fields.
What all the methods have in common is the dependence on the human factor. The capacities and the motivation of the people working on innovations is crucial. They contribute to their creativity and their skills. They need to be willing to tackle a problem, search for solutions, and deal with all the setbacks that occur.
It is no surprise that the described methods, like so many others, contain elements such as visualization, co-creation, interdisciplinary teams, etc. that are well-known for successful collaboration and innovation in general. People try to get the most out of theoretical insights and practical experiences, add new ideas, and refine their approaches with their lessons learned. They combine what works well and leads to useful results.
On the positive side, innovation methods can create opportunities and increase the effectiveness of innovation efforts. They help companies to use their scarce resources such as humans, time, and money more effectively. Innovation methods provide a sense of security to both innovation teams and executives in terms of predictability and manageability of innovations.
On the harmful side innovation methods can create boundaries, biased thinking, and limitations. Some people also perceive systematic approaches as a kind of bureaucracy that kills creativity. Following a specific technique over and over again could increase these effects. In the end, this might cause an organization to miss those promising business opportunities that are far away from the obvious. People always have to be aware of the specific conditions and limitations of an innovation method while using it.
In the best case, an innovation method can be considered as best practices. Preferably it should be an approach combining both practical experiences and theoretical insights.
Of course, people can become fans of a specific method and would like to see it used more often and implemented as broadly as possible. Methods contain guidelines and function as recipes. Furthermore, they set standards, directions, and limitations. All this together might lead to unintended effects: If you use the same methods and similar processes your competitors do, how can you reach better results and set yourself apart
In general, it is crucial to find an approach that matches with the people, the organization, and the specific challenges of companies and industries. As mentioned before, people working with a particular method or tool should always be aware of their natural conditions and limitations.
I recommend and would like to encourage you to select what seems promising and appropriate to your business, your employees, the situation, and the challenges your company is currently facing. Experiment with different approaches, methods, and tools to initiate and develop innovations. Try to judge them by the results you and your teams achieve by using them. Stay open-minded and follow a path of innovation and learning for your innovation approach itself. It enables your company to deliver outstanding future innovations based on its own unique and ever-improving approach. Of course, this is an ongoing challenge if you want to keep your company in the game of innovation.
In the end, the humans are the ultimate key to innovation success. The results you and your company can achieve, depend very much on the capacity and motivation of the people involved. They can make the difference between mediocre or outstanding results of the same approach, method, or tool.
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Sources and recommended reading
Brown, Tim, & Katz, Barry. (2009). Change by design : How design thinking transforms organizations and inspires innovation. Retrieved from https://itunes.apple.com/us/book/change-by-design/id360637415?mt=11
Kim, W. Chan, & Mauborgne, Renée. (2015). Blue ocean strategy : How to create uncontested market space and make the competition irrelevant (Expanded ed.). Retrieved from https://itunes.apple.com/ca/book/blue-ocean-strategy-expanded-edition/id945769529?mt=11
Lockwood, Thomas, & Papke, Edgar (2018). Innovation by Design : How Any Organization Can Leverage Design Thinking to Produce Change, Drive New Ideas, and Deliver Meaningful Solutions. Retrieved from https://itunes.apple.com/us/book/innovation-by-design/id1334948602?mt=11
Ries, Eric. (2011). The Lean Startup : How constant innovation creates radically successful businesses. Retrieved from https://itunes.apple.com/us/book/the-lean-startup/id422540072?mt=11
This article was originally published on www.buero-zueri.ch