Wednesday, September 13, 2006

Innovation Radar

What is innovation? Exactly? Although innovation is curently amongst the top-issues of many corporations, many executives have a wrong, too narrow view of it. They see innovation as synonymous with New Product Development or Traditional R&D.

To clarify this error, Professors Mohanbir Sawhney, Robert C. Wolcott and Inigo Arroniz in the MIT Sloan Management Review (Spring 2006) introduce their Innovation Radar. The radar features four major dimensions that serve as business anchors:

  • Offerings a company creates (WHAT).
  • Customers it serves (WHO).
  • Processes it employs (HOW).
  • Points of Presence it uses to take its offerings to market (WHERE).

Spread over these 4 main dimensions, companies can innovate their businesses far broader in scope than product or technological innovation: a company can actually innovate along any of 12 different dimensions, including the main 4 ones I already mentioned:

  1. Offerings.
  2. Platform.
  3. Solutions.
  4. Customers.
  5. Customer experience.
  6. Value capture.
  7. Processes.
  8. Organization.
  9. Supply chain.
  10. Presence.
  11. Networking.
  12. Brand.

The innovation radar can help to broaden the innovation focus in companies and to show that innovation is about creating new value, not about creating new products.

3 Comments:

Anonymous Evolving Wheel said...

I think among your 12 mentioned dimensions, BRAND is one of the most critical element. The value of the brand helps to enhance the other dimensions like offering, value capture, and presence. Actually, a brand name even helps to identify the feasibility factor behind the success of a product. It allows to cushion and problem with the technological delivery to a certain extent as well. Example: If Apple goofs up in its new iPhone, it can still get some cushion off the brand name and deliver a patch without loosing too much of presence. It gives the leverage.

http://innovech.wordpress.com

5:24 PM  
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2:09 PM  
Blogger miwtech said...

I am left to wonder how the 4 major dimensions completely ignored the most important fifth dimension, the one that drives the other 4 and the other 12 - Purpose for the company's existence (WHY)

One could assume the universal answer will always be - "To Make Profit". But you know what they say about making assumptions.

Companies should realize that their very existence impacts the world we all live in. Once a corporation is founded it functions as a person. I would refer everyone to watch a compelling documentary called "The Corporation" which examines corporate entities as people, from the perspective of a psychologist. Their conclusions indicate that the average corporation fits a profile consistent with a total raving psychopath!

In my view this is a direct result of the mysteriously missing (WHY).

True innovation is as boundless as the creative critical thinking that brings it into being. Certainly innovation can be compartmentalized into the dimensions stated, but they should always maintain a relationship toward satisfying an overriding agenda (WHY). The declining state of global society, economy, and environment, are all repercussions of the (WHY) being purely for profit.

What would happen if the (WHY) switched from profit to "Make a Better World"? Ultimately companies make profit by providing things of value to people. The way the winds are blowing value is taking on a new meaning. I'm horrified to hear major innovation speakers talking about applying innovation to prominent emerging market trends such as biotechnology. Companies like Monstanto for example have employed innovation to reap tremendous profits, but at what cost to the world? No doubt their stockholders are delighted, but this happiness may be short lived as the full repercussions genetic engineering monopolies wreak havoc on our quality of life. Don't even let me get started on Big Pharma.

People are starting to realize that true quality of life is not based on acquiring cheap stuff from China. There is a growing market in products and services ergonomic to real living which stand in direct opposition to the main stream. Currently it is the smaller grass roots companies catering to this market and they seem to be doing quite well in the current economic climate. There is a deepening line being drawn in the sand, and it's time to pick a side. Stay true to a noble vision of (WHY) and to be sure the profits will take care of themselves.

2:00 PM  

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