Organizations Must Innovate or Fade Away
By Bruce L. Katcher, Ph.D. President of The Discovery Group
According to Benjamin Franklin, "Insanity is doing things over and over again and expecting different results." Many organizations offer the same types of products and services to the same types of customers in the same way year after year. And, then they wonder why:
- The competition can offer the same products and services at a lower price;
- Their once high value products and services are now viewed by customers as commodities;
- The demand for their products and services has waned.
Here are some reasons why many organizations do a poor job of developing innovative new products and services:
- They are unwilling to make financial investments in research and development;
- They do little or no market research to assess customer needs;
- They are unwilling to take the risks of testing new products and services;
- They fail to involve employees in developing or implementing new ideas.
WHAT CAN BE DONE
- Develop "Criteria" for New Products and Services"
How much revenue does your organization need from a new product or service? Which of your core competencies should the new product or service leverage? How long should it take to bring the new offering to market? These are important questions that senior management needs to systematically address in evaluating any new ideas.
- Institutionalize the Development of New Products and Services. Although many organizations staff R&D and New Product Development departments, many do not. In that case they have no formal mechanisms (i.e. employees, budgets, or resources) devoted to developing their next generation of products and services. They also have no way to implement new ideas if they happen to surface.
- Get Past the "NIH Syndrome" Organizations need to be receptive to new ideas regardless of their origin. Many, however, have developed an unstated cultural norm that if a new idea was "not invented here" (NIH), it is not worth considering.
- Bring in Outside Experts from Other Fields. Organizations often rely on expertise from consultants or new hires from the competition. But often, the best ideas come from outside of your field. Great ideas can be gathered by conducting facilitated focus groups with experts from fields only tangentially related to yours.
- Involve Employees. One of the great lessons from the quality improvement movement is that front line employees have many great ideas for how an organization's products and services can be improved -- ideas that would never occur to senior management. These ideas need to be tapped in a systematic way.
- Focus on Implementation. Many organizations do, indeed, have great ideas for new products and services but they never get them off the drawing board. Create cross-functional teams to work on implementing these ideas. Include employees from different departments and at different levels of the organization to help translate ideas into reality. Also, seriously consider using an outside facilitator to make certain that the teams stay on track.
The Discovery Group provides research-generated insights to help our clients discover how to delight their employees and customers.
Contact Bruce L. Katcher, Ph.D., "The Survey Doctor"
President THE DISCOVERY GROUP
9 Blair Circle Sharon, MA 02067
Voice - 781-784-4367 Fax - 781-784-6450
E-mail - BKatcher@DiscoverySurveys.com www.DiscoverySurveys.com