The Future of Managing Innovation
In a world where Twitter and Facebook can make or break your business, how companies manage the next generation of innovation will play a big part in their success, says Will Stirling at AU2011.
If there’s one thing that Americans are good at its hype.
At Autodesk University the seminars are delivered by articulate professionals – polished performers at persuading you that their subject is, truly, a game-changer for business.
But once you’ve cut a swath through the marketing hubris, its often pretty compelling stuff.
One of the big recurrent debates at the 4-day conference is innovation and which approach is the most effective. Do companies do better when they tell their customers what they want and back themselves to know what’s best, like Steve Jobs and Henry Ford (who famously said “If I asked my customers what they want, they’d ask for a faster horse.”) Apple relies solely on its senior design team to develop new products, and wouldn’t stoop to ask its customers for fear of being perceived to be short on ideas.
Or is incremental, step-by-step innovation the formula for success? Here companies use market research and “crowd-sourcing” to empirically establish what is the best thing to develop. Proctor & Gamble did this with the Swiffer, a duster/cleaner hybrid for the home. A roaring success, its need had been established by a comprehensive and expensive market research programme. You can be successful by innovating in small, careful ways and using customer data.
Innovation, a much used and abused term, can be defined as capitalising on the ability to change products and service to match business conditions. Social media is a good example of an innovation challenge and opportunity. On Tuesday (Nov 29) Randi Zuckerberg, former founder and director of marketing at Facebook, gave a dynamic talk about social media and the power with which it can affect a company’s sales, and reputation.
“People are talking about your brand online whether you are part of the conversation or not,” the Harvard graduate told the audience, citing the example of the YouTube video of a man whose guitar was broken in transit when he flew United Airlines. The company’s response was underwhelming, so he wrote a song and made a video lampooning its customer service as baggage handlers toss suitcases around with abandon. The video has received over 11,200,000 visits – a far costlier PR exercise than replacing a guitar.
Zuckerberg also said, a touch nauseatingly, “Haters are an inch away from loving you if you just give them a little bit of love.” While the statement is scarily close to the hackneyed “a stranger is just a friend you haven’t met”, there is merit in this notion as another company proved when, by harnessing Facebook and Twitter to communicate its CSR work in the modern way, it turned a large part of a protestors group into fans. The story serves to show the power, positive or negative, of social media for business.
Monica Schnitger, an engineer and founder and president of Schnitger Corporation, advocated the latter approach. P&G, she said, recently grew sales by 20% by introducing new but relatively small products like the Swiffer. Much of its strategy was based on crowd-sourcing.
A keen mountain biker, she explained how the mountain bike evolved, from a bastardised machine pieced together from bits of road bikes and BMX bikes by some friends living near the Nevada mountains, to the most popular bicycle style in the world, accounting for 50% of sales worth $3.5bn in the US alone. Mountain bikes evolved gradually by making incremental innovations. “What’s your mountain bike?” she asked the audience. “Find it and stick to that.”
How to stop PLM failing
Discussing Product Lifecycle Management, Ms Schnitger says PLM is a misused tool that has had the effect of holding innovation back rather than explorations its practical limits, as it is designed to.
She says that the ‘P’ is often the problem behind a failed PLM strategy, where people should examine the whole business lifecycle rather than single products within it, to assess true lifecycle impacts. For many, PLM “gets in the way”, is a burden on innovation, and the challenge is to practice full potential PLM – not just product data management, PDM – without constraining the ideas.
As organisations get increasingly complex, the big challenge Schnitger says is figuring out in the huge harvests of data what is relevant and important, e.g. that email that says someone has a warranty issue with a part, which if missed can have a domino effect.
Another problem is that companies are not including all the people in PLM that they need to in the collaboration to get the best value out of PLM. “Not everyone speaks CAD. PLM needs to find a way to translate the information so that all departments of a business can use it.”
What’s your mountain bike?