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Real Innovation

Customer insight is the foundation for delivering real innovation

Innovation is an overused term in business today.  Customers are constantly being bombarded with claims of “new and improved” offerings.  With so much messaging around innovation, it’s easy to see how people can become jaded.

Companies pursue innovation, or at least the perception of innovation, because they recognize the potential it has for their business.  Here’s a great quote from Peter Drucker:

“Because the purpose of business is to create a customer, the business enterprise has two – and only two – basic functions:  marketing and innovation.  Marketing and innovation produce results; all the rest are costs.”

– Peter Drucker

Since, according to Drucker, both marketing and innovation produce results, it’s easy to see why many companies just market “new and improved” rather than deliver substantially improved products or services.  It’s easier to change the message than it is to change the offering.

Even so, the reality is real innovation can delight your customers and turn them into fans for your brand.  Where does the innovation process begin?  With the customer.  It’s a simple but hard truth that if you want to “Wow!” your customer you need to understand them better. 

  • What are they trying to accomplish?
  • What benefit do they receive from you today?
  • What problems or frustrations do they have with your current offering?
  • Are there other related problems they wish you would solve?

Let’s look at an example.  Picasa is a free photo organizer from Google.  Early versions focused on organizing images on your computer and importing photos from a digital camera.  Over time the product evolved to include image editing, printing, and sharing.  These new features were added because Google recognized that people do more than just organize their photos.  They crop them, print them in collages, and share them with family and friends.  By better understanding what people do with pictures, Google addressed problems outside the original scope of photo organization.

Real innovation is based on insight into the needs of your customers.  Walk in your customers shoes.  See your business from their perspective.  And in the immortal words of Chevy Chase in Caddy Shack, “be the ball.”


Rethink Before Rebuilding

Why taking advantage of new technology requires rethinking

Over the years we’ve worked on a number of projects where the goal was to rewrite an existing system to take advantage of new technologies, hardware platforms, and so on.

On the surface it seems easy.  The client invariably says something along the lines of:  “Just take what we have now and rewrite it for the web.”  The same applies to cloud computing and mobile apps.

The flaw with this approach is that the way “what we have now” works and the way the web works are fundamentally different.  For example, a typical web application allows customers to log into the system, place orders, check status, update payment information and so on.  The customer is a first class participant in the way the system works.  On the other hand, the “what we have now” system is only used by internal staff.  There is no concept of customer roles, permissions, and work flows. 

The first step in taking advantage of a new technology is to rethink how your customers will interact with the new system.  Step into your customer’s shoes and approach your business from their perspective.  What are they trying to accomplish?  What information do they need to make a decision?  How do they want to be notified of progress or problems?  What is the right level of detail to share with the customer?  They probably don’t want to know how the sausage is made; they just want to buy the finished product.

Now repeat the same exercise for the different user roles within your company.  Focus on the needs of the individual roles.  The executive, finance manager, and production manager all have very different needs.

If you skip the rethinking exercise your new system will not be as good as it could be.  You’ll miss the opportunity to delight your customers and your business won’t reap the full benefit of your investment in new technology.


Video from Innovation in RTP Talk

Here's the video of the Innovation in RTP talk I gave on April 11, 2012.  Look mom, I'm on YouTube!

The rest of you are probably better off just downloading the handout from the event.


Customer Insight Drives Innovation

Why the driver of innovation today is insight, not technology.

Companies need to deliver new and innovative offerings to attract and retain customers.  Simply put, innovation occurs when your customer says:  “Wow!  I’ll buy that.”

Innovation is important because customer expectations are changing and the competition is innovating to lure customers away from your business.

Many times companies look to technology to help drive innovation.  This makes sense because new technologies really are shaking up the way businesses interact with their customers.  The problem with a technology driven approach is the overwhelming number of options available.  It’s also easy to lose sight of the customer and get caught up in chasing the latest and greatest technology fads.

A better approach is to start by understanding the purpose or belief that drives your company forward.  In his excellent TED talk, Simon Sinek states, “People don’t buy what you do, they buy why you do it.”

Now go out and talk with customers – as in real live conversations with real live people.  No email or texting is permitted.  Focus on understanding your customers and their needs.  What do they really care about?  What is the real benefit they receive from your company?  What problems are they experiencing?  What ideas do they have?  The only difference between a problem and an idea is the language used to describe it.

Tap into your experience and intuition to develop customer insight that allows you to distinguish between what customers say they want and what they really need.  Use your customer insight to evaluate ideas and technologies.  Think about how you can change the way customers interact with your business.  Think about how you can improve the overall customer experience.

The driver of innovation today is insight, not technology.

Have courage – don’t be encumbered by how things have been done in the past.  If you’re not willing to take market share from another part of your business, your competition will gladly do it for you.

Technology can be used to meet the status quo or make something new.  Maintaining the status quo doesn’t help you win new business – it simply keeps you from being eliminated from consideration in the first round.  Successful companies use technology to support and enhance their competitive advantages.

The real value of new technology is rethinking how customers interact with your business.

Companies need customers to stay in business.  Innovation is a key element for attracting and retaining new customers.  Innovation is driven by customer insight.  The more you know about your customers, the better your chances for creating new offerings that they will notice and buy.


Innovation in RTP Handout

I'm delivering a presentation on Rethinking the Role of Technology in Your Business at the Innovation in RTP event later this afternoon.

Here's a quick summary of the talk.  

Companies need customers to stay in business.  Innovation is a key element for attracting and retaining new customers.  Innovation is driven by customer insight.  The more you know about your customers, the better your chances for creating new offerings that they will notice and buy.

The real value of new technology is rethinking how customers interact with your business.

Here's a handout of the presentation for your reading pleasure.