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The Role of Technology in Innovation

Technology plays a part in innovation, but not in the way that many people think.  For the common person, technology has no value on its own.  To make a difference, it has to be appropriately applied to solve specific problems or meet certain goals as defined by your business or your customer.  To maximize the value of that difference, it’s essential to apply only the smallest amount of technology to the areas that stand to benefit from it.

Too many people like technology for its own sake.  They get caught up in fancy gadgets, spec sheets, and bullet points.  They think that having technology is innovative in and of itself.  This is not true.  Innovation only happens when you use technology to provide a real or perceived value to your customer.

There are two primary uses for technology in business: to meet the status quo (web site), and to create something new that moves the business forward (innovation).  In either case, the use of technology should be driven by the needs of the business and the customer.

The status quo case is basically the price of admission.  Every company these days needs a web site.  It really doesn’t add much value to your company, but you need it to do business.  The most successful companies are those that use technology to support and enhance their market differentiators.

Take, for example, Domino’s pizza.  After mounting criticism of their pizza from focus groups and social media sites, Domino’s decided to try something new: listen to their customers, speak frankly to them, encourage feedback, and create a better pizza and a better experience.

They revamped their recipes, created a new marketing campaign, and tried again.  They also used technology in several targeted ways to facilitate communication between them and their clients.

Specifically, they created an online Pizza ordering tool that allowed customers to, 1) order their pizza, 2) track its cooking and delivery process, and 3) provide feedback to the store about “how they’re doing”.

The result of the campaign?  Domino’s reported a more than doubled fourth-quarter profit.

The driver of innovation today is not technology, but insight.  What do customers want?  How can you make it easier for them to do business with you?  And where can technology help reinforce those insights?